Preamble

The House met at half-past Two o'clock

PRAYERS

[MR. SPEAKER in the Chair]

Message from the Queen

DOUBLE TAXATION RELIEF

The Vice-Chamberlain of the Household reported Her Majesty's Answer to the Addresses, as follows:

I have received your Addresses praying that the Double Taxation Relief (Taxes on Income) (Trinidad and Tobago) Order 1983, the Double Taxation Relief (Taxes on Income) (Tunisia) Order 1983, and the Double Taxation Relief (Taxes on Income) (Netherlands) Order 1983 be made in the form of the drafts laid before your House.

I will comply with your request.

PRIVATE BUSINESS

NOTTINGHAMSHIRE COUNTY COUNCIL BILL [Lords] (By Order)

Order for consideration, as amended, read.

To be considered upon Thursday 8 December.

SHREWSBURY AND ATCHAM BOROUGH COUNCIL BILL [Lords] (By Order)

TEES AND HARTLEPOOL PORT AUTHORITY BILL (By Order)

DARTFORD TUNNEL BILL [Lords] (By Order)

Orders for Second reading read.

To be read a Second time upon Thursday 8 December.

Oral Answers to Questions — HOME DEPARTMENT

Immigration Act 1971

Mr. Proctor: asked the Secretary of State for the Home Department what progress he has made in his review of section 29 of the Immigration Act 1971.

The Minister of State, Home Office (Mr. David Waddington): The review of the administrative criteria governing the repatriation scheme under section 29 of the Immigration Act 1971 is virtually complete. However, before reaching final conclusions, my right hon. and learned Friend intends to take account also of the outcome of a complementary study of the possibility of combining the section 29 scheme with similar arrangements operated under supplementary benefit legislation. I hope shortly to be in a position to make a further statement about these matters.

Mr. Proctor: I thank my hon. and learned Friend for that helpful and informative reply. When and if the merger takes place, will he ensure that the scheme is operated and administered by a Government Department and not by an International Social Service charity in Brixton? When the circular is put out eventually, will my hon. and learned Friend ensure that copies go to members of the ethnic press?

Mr. Waddington: I cannot give the undertaking for which my hon. Friend asked. We have no reason to think that International Social Service of Great Britain has been operating the scheme in other than a most efficient and sensible fashion.
We need to ensure that people who genuinely need help receive it, but we do not wish to give a false impression of our attitude to repatriation. We shall need to issue a fresh circular to local authorities and other interested bodies to explain the revised arrangements. I shall consider what special arrangements, if any, should be made for the ethnic minority press.

Mr. J. Enoch Powell: Do the Government recognise that it was always improper to entrust the performance of these statutory duties to a private body which declared itself unsympathetic to performing them?

Mr. Waddington: I shall bear the right hon. Gentleman's view in mind. I can only repeat that we have no reason to think that International Social Service has not been operating the scheme in a sensible way.

Mr. Bottomley: Will my hon. and learned Friend make it clear that the Act, the Government and the Conservative party are unsympathetic towards any impression that we wish people to leave this country, other than of their own free will?

Mr. Waddington: Yes. This is a sensitive matter. That is why I was cautious in replying to the second supplementary question. It is clearly our duty to let people know about the facilities available, but we must not give the impression that we are inducing people to leave because we do not wish them to be here.

Mr. Madden: Will the Minister take steps to end the public scandal of fiancés wishing to enter this country to


marry British citizens being refused entry because those whom they wish to marry are unemployed and do not have adequate accommodation? Will he ensure that that scandal is ended as quickly as possible, rather than concern himself with repatriation?

Mr. Waddington: rose——

Mr. Speaker: Order. I am not sure that that relates to the question at all, but the Minister may make a brief reply.

Mr. Waddington: I cannot see anything scandalous in making it a requirement that a person shall have means of support when he has entered the country. It is absurd to suggest that our immigration rules should operate in such a way as to allow people to enter the country and immediately become a charge on public funds.

Visitor's Status

Mr. Carter-Jones: asked the Secretary of State for the Home Department if he will list by country of origin the number of persons who have been refused visitor's status to date in 1983.

Mr. Madden: asked the Secretary of State for the Home Department how many persons were granted visitor's status to the United Kingdom to date in 1983; and what was the figure for the comparable period of 1982.

Mr. Waddington: In the first nine months of 1983, 5·4 million passengers from outside the European Community were given admission and 10,625 passengers from all countries were refused leave to enter. I shall circulate in the Official Report details of the nationalities concerned. Separate information is not available as to the number of those refused who were seeking admission as visitors. In the same period, 4·1 million nationals of countries outside the European Community were admitted as visitors, compared with 3·6 million in the first nine months of 1982.

Mr. Carter-Jones: Will the Minister express the figures for refusals as percentages by nationality and account for any discrepancies?

Mr. Waddington: I am prepared to table a list of the kind requested by the hon. Gentleman. In general, there are very few refusals compared with the number of people seeking entry. Even for the Indian subcontinent, where pressures to come here are naturally far greater than in, say, America, because of the discrepancy in the standard of living, I believe that the rate of refusal last year was 0·5 per cent. or about 1,000 out of 200,000 of those coming here from India, with similar figures for other countries of the subcontinent.

Mr. Budgen: Is my hon. and learned Friend aware that there will be widespread dismay at his statement yesterday that no further significant reduction in immigration can be expected, especially as the figure is now running at just under 29,000 per year? Will he give some partial reassurance by repeating the promise that he gave when the last set of immigration rules were passed, namely, that if the number of male fiancés seeking admission increases greatly the rules will be reviewed with a view to restricting the number?

Mr. Waddington: The number of people accepted from the world as a whole and from the New

Commonwealth has fallen significantly since the Government came to office in 1979, in pursuance of our declared aim of tightening the immigration rules. The point that I made at the Royal Commonwealth Society yesterday was that two thirds of the people now being accepted from the New Commonwealth are relatives of those already accepted for settlement. We must remember that the families of those settled before 1 January 1973 have a statutory right to come here. Moreover, Governments have given undertakings that families of men settled after that date will be allowed to enter.
On the second point, the undertaking given in February by my noble Friend Lord Whitelaw, as he now is, was that the rules would be re-examined to ensure that they continued to produce the full and fair immigration control to which we are committed.

Several Hon. Members: rose——

Mr. Speaker: Order. I appeal for shorter supplementary questions and for shorter answers.

Mr. Madden: Is the Minister aware that all who are interested in these matters have detected a concerted effort in recent months to reduce the number of visitors given permission to enter this country? Will he deny that the immigration service has been given such advice through a series of nods and winks from the Department?

Mr. Waddington: That is utter rubbish. The hon. Gentleman should read the text of my reply. The number of people entering this country has risen since 1982. The number of refusals has risen in proportion.

Mr. Denis Howell: Is the Minister aware that increasing distress is being caused to family visitors and is undermining good community relations? Does he appreciate that the phrases used by Ministers to justify their decisions—a letter to me recently stated that
there seems to be no good reason for this … family visit … at this time"—
are not just an affront to basic ethical concepts of family life which are common to all religious belief in this country, but cause great distress to the people involved? Does he appreciate that the following quotation from a ministerial letter referring to a man with four children in Pakistan who wished to enter this country as a visitor,
He would not appear to have sufficient incentive to return home
adds a poverty test to the racial test and is utterly unacceptable? Will he consider introducing a new system of guarantees for visitors by family and friends which will safeguard against improper entry, while maintaining the decencies of family life?

Mr. Waddington: The right hon. Gentleman and others, I fear, seem to have forgotten that Parliament approved new rules as recently as February this year. Those rules require immigration officers in Britain to be satisfied that a person seeking entry as a visitor is a genuine visitor. The point made in the letter about which the right hon. Gentleman complains is that among the factors which weighed in the immigration officer's mind before refusing entry was that there did not seem to be a good reason for that person to spend an enormous amount of money on a visit at that particular time.

Following are the details:

Passengers refused leave to enter the United Kingdom 1 January 1983–30 September 1983



Number of persons


Commonwealth countries


Associated states
16


Australia
36


Bangladesh
232


Barbados
1


Canada
39


Cyprus
90


Ghana
787


Gibraltar
1


Guyana
15


Hong Kong
110


India
970


Jamaica
36


Kenya
71


Malaysia
83


Malta
18


Mauritius
57


New Zealand
15


Nigeria
1,410


Sierra Leone
30



Singapore
33


Sri Lanka
247


Tanzania
99


Trinidad and Tobago
7


Uganda
40


Zambia
11


Zimbabwe
31


United Kingdom Passport Holders
44


Other Commonwealth countries
80


Total Commonwealth
4,609


European Community



Belgium
11


Denmark
9


France
135


Germany (Federal Republic)
96


Greece
73


Republic of Ireland
1


Italy
92


Netherlands
86


Total EC
503


Non-EC foreign countries


Algeria
415


Arab Republic of Egypt
48


Argentina
53


Austria
38


Brazil
49


Bulgaria
6


Chile
61


China
7


Colombia
127


Cuba
5


Czechoslovakia
10


Ethiopia
11


Finland
16


German Democratic Republic
5


Hungary
14


Indonesia
15


Iran
183


Iraq
64


Israel
79


Japan
51


Jordan
23


Kuwait
10


Lebanon
43


Libya
32


Mexico
19


Morocco
353


Norway
25


Pakistan
784


Peru
31


Philippines
63

Number of persons


Poland
52


Portugal
138


Romania
12


Saudi Arabia
92


Somalia
1


South Africa
52


Spain
262


Sudan
31


Sweden
60


Switzerland
44


Syria
26


Thailand
54


Tunisia
105


Turkey
315


United States of America
425


Union of Soviet Socialist Republics
236


Uruguay
8


Venezuela
15


Yugoslavia

86


Other foreign countries
266


Stateless
593


Total Non-EC foreign
5,513


Grand Total
10,625

Military Bases (Policing Costs)

Mr. Canavan: asked the Secretary of State for the Home Department what information he has as to the total cost to civilian police of policing in relation to military bases where nuclear weapons are located or planned to be located.

The Secretary of State for the Home Department (Mr. Leon Brittan): For good security reasons, successive Governments have not confirmed or denied the presence of nuclear warheads at particular bases, but if asked to do so I would readily provide information about the cost of policing any particular base in England and Wales.

Mr. Canavan: If the Government are so obsessed with cutting public expenditure, why is the cost of policing Greenham common now more than £1·5 million per year, on the Government's own estimation? If, as the Government claim, the American weapons of death are here to defend the people, what justification is there for forcing the people to spend more than £1·5 million of their own money defending those weapons against the people?

Mr. Brittan: If the hon. Gentleman is as concerned about public expenditure as he purports to be, perhaps he will persuade some of his friends not to turn up at Greenham common, so that more money is available for more constructive purposes than policing that base.

Mr. Jackson: Does my right hon. and learned Friend agree that although letting police costs fall where they lie may be a sound principle in general, it cannot be applied with equity in situations requiring exceptional measures to be taken by the police on a continuing basis?

Mr. Brittan: All police forces must sometimes meet demands that can be characterised as of national as well as local significance. The Government meet more than 60 per cent. of the cost of policing Greenham common. Nevertheless, in view of the exceptional burden on the Thames Valley police, we are considering whether there is some means by which the Government can help.

Mr. Alex Carlile: Does the Home Secretary agree that it is unjust to place upon local ratepayers the responsibility of paying anything, let alone 40 per cent., towards the cost of policing Greenham common or, for that matter, the kind of organised public disorder that has taken place in Warrington?

Mr. Brittan: I should not go as far the hon. Gentleman. I hope that the answer that I gave to my hon. Friend's supplementary question shows the sympathy that I have for the ratepayers who are currently having to meet a proportion of the cost of policing Greenham common.

Mr. Eldon Griffiths: Is my right hon. and learned Friend aware that, in addition to the cost that falls upon the ratepayers because of the need to deploy police officers to defend the Queen's peace, another cost is that paid in the neighbourhoods from which the police presence has been withdrawn to police such major demonstrations? The consequent cost to many people of burglaries and vandalism, which arise because the police are removed, is great.

Mr. Brittan: I agree with my hon. Friend.

Cable Television

Mr. Dykes: asked the Secretary of State for the Home Department when he expects to announce the successful applicants for the 12 pilot cable television licences.

The Minister of State, Home Office (Mr. Douglas Hurd): My right hon. and learned Friend did so on 25 November, in reply to my hon. Friend's earlier question. We intend to issue pilot project licences to 11 applicants, subject to the satisfactory conclusion of further discussions with them on some specific points in their applications.

Mr. Dykes: I thank my right hon. Friend for that answer. Were the successful applicants judged just on the intrinsic merits of their applications and financial strengths, or were there further implications in the choices made? Does my right hon. Friend foresee that the further implications might be useful for additional applicants when the first round of applications begins after the introduction of the legislation next year?

Mr. Hurd: The applications for the pilot project were of a high quality. Above all, we were looking for systems which showed a positive contribution to applying advanced technology, of providing a comprehensive range of programme services and having the capability for interactive services.

Mr. Ashton: As it is now standard practice for companies which gain Independent Broadcasting Authority franchises flagrantly to break their promises in every instance and disregard everything that they said to obtain the franchises, what assurances can the Minister give that that will not happen with cable television?

Mr. Hurd: We have today published the Cable and Broadcasting Bill. If the hon. Gentleman reads it, he will realise that the Government are proposing, if Parliament agrees, to set up a cable authority to provide safeguards to deal with precisely such matters.

Voluntary Organisations (Ministerial Speech)

Mr. Chris Smith: asked the Secretary of State for the Home Department if he will place in the Library a copy

of the text of the speech made by the Minister of State to the National Council of Voluntary Organisations on 13 November.

Mr. Waddington: I have placed a copy in the Library today.

Mr. Smith: Will the Minister be good enough to deposit in the Library an explanation of what he meant by
political activities carried out by charitable organisations."?
Will he confirm to the House that it is perfectly right and proper for charities to express public anxiety on issues of a general, and sometimes political nature if their experience of individual suffering leads them to believe that general issues are at stake?

Mr. Waddington: I made it clear in my speech that I was talking about party political activities. I see nothing wrong in voluntary bodies campaigning even for changes in the law — and, in the case of charities, within the restraints of the law. I said that in the longer term a neutral or an apolitical stance was important for the voluntary sector and in its own interests.

Mr. Jessel: Is it a welcome fact that an increasing number of voluntary organisations that are financed partly by public money devote a growing proportion of their time and money to campaigning on what they think Parliament and the Government should do? Why should the Government be expected to vote finance for such matters? Would it not be much better if voluntary organisations and charities concentrated more on their traditional role of helping people direct?

Mr. Waddington: I said in my speech that if I were a member of the management team of a charity or voluntary body I should rather be criticised for putting too much emphasis on services to clients and too little on their political context, than to risk the opposite criticism and a loss of public good will.

Obscenity and Film Censorship

Mr. Michael McNair-Wilson: asked the Secretary of State for the Home Department whether he will introduce legislation to implement the recommendations of the Williams committee report on obscenity and film censorship.

The Under-Secretary of State for the Home Department (Mr. David Mellor): It is clear that there are very wide differences of opinion on the direction and the form any new legislation should take. These differences were reflected in the public reaction to the Williams report and we are not satisfied that its recommendations, taken as a whole, constitute a sufficient basis of agreement for the purpose of comprehensive legislation in this field.

Mr. McNair-Wilson: Does my hon. Friend agree that the Lord Chief Justice, when presenting the Darwin lecture, gave it as his opinion that there was a direct link, albeit imitative, between the sex and brutality depicted in pornography and films and the rise in the number of sex crimes and crimes of violence? If the Lord Chief Justice is right, is there not a moral imperative on the Government to take further action?

Mr. Mellor: Since the Government have been in office they have taken action against sex establishments. We have supported private Members' legislation against sex shops and fake cinema clubs. During the present


Parliament, the Government have already given the strongest support to a useful measure proposed by my hon. Friend the Member for Luton, South (Mr. Bright) to curb video nasties. We will give the most serious attention to any similar proposals.

Mr. Lawrence: As one of the main drawbacks in this area is that juries persist in acquitting defendants because of the unworkable legal definition of "obscenity", will my hon. Friend consider redrafting the obscenity legislation to contain a list of actions which the most reasonable people in the world would consider to be obscene?

Mr. Mellor: Problems arise in the listing approach. I have already said that we take the matter seriously and are open to suggestions.
The Obscene Publications Act 1959 is in no sense a dead-letter. Last year 234 people were convicted of offences under section 2 of the Act. In the Metropolitan police area alone, more than 22,000 obscene video tapes were confiscated and destroyed.

Burglaries

Mr. Alton: asked the Secretary of State for the Home Department what is the change between the number of burglaries recorded in the first half of 1983 and the corresponding figure for 1979.

Mr. Brittan: Between the first half of 1979 and the first half of 1983 the number of offences of burglary recorded by the police in England and Wales increased by about half.

Mr. Alton: Is the Home Secretary aware that in the first six months of the year one burglary was committed, on average, every one to one and a half minutes? The crime of burglary is costing about £127 per second. Would it not be better to use these resources to provide more intruder alarms for the elderly, to put more policemen on the beat and to extend the home watch scheme? Do not the figures that I have quoted give the lie to the Prime Minister's oft-repeated remark that there is no relationship between massive unemployment and the massive increase in the number of burglaries?

Mr. Brittan: I assure the hon. Gentleman that I support crime prevention measures. One of my first actions at the Home Office was to establish a crime prevention unit, thereby forwarding these matters.
There is no established link between rates of unemployment and increased crime. Will the hon. Gentleman examine research bulletin No. 14, which is published by the Home Office and reviews the research evidence? If he does not wish to examine that document, if he cares to read the Social Science Research Council paper by Professor Stern — who is professor of economics at Warwick university — and Dr. R. Carr-Hill, he will find corroboration for that opinion.

Mr. Hanley: Will my right hon. and learned Friend take this opportunity to congratulate the Commissioner of Police of the Metropolis on the successful take-up of both the home beat scheme and the neighbourhood watch scheme throughout the metropolis?

Mr. Brittan: I welcome the opportunity to do that, and do so readily.

Mr. Corbett: Does the Home Secretary accept that the best way to put a damper on the crime explosion that has occurred since the Government have been in office is for them to take measures to get people back to work?

Mr. Brittan: It is important that unemployment should be reduced as rapidly as possible. Unemployment is a scourge on our society and a social evil, but it is not the cause of crime. I also believe that the best long-term prospect for sustaining employment is for the Government to complete the work of putting right the economy.

Mr. Kaufman: The right hon. and learned Gentleman has admitted that the number of burglaries has increased by 50 per cent. under his Government. As he said recently that it would take time to curb crime, will he now say precisely how long it will take to reduce the number of burglaries to their level under the Labour Government?

Mr. Brittan: The right hon. Gentleman knows that making such a political distinction does not add anything to his case. If he is nimble in his arithmetic, he might appreciate that whereas the increase in burglary offences between the first half of 1979 and the first half of 1983 was indeed 50 per cent., the total for the first six months of 1983 was only 3 per cent. higher than in the corresponding period last year.

Criminal Trials (Review)

Mr. Ashley: asked the Secretary of State for the Home Department what progress has been made in reviewing the cases in which Dr. Clift gave forensic evidence; and when a statement can be expected.

Mr. Brittan: The review is nearing completion and hope to be able to announce my conclusions soon.

Mr. Ashley: Is the Home Secretaray aware that I especially welcome his reply, because Dr. Clift's forensic evidence has helped to convict one of my constituents of murder? That evidence has now been discredited. Other people who have been convicted because of Dr. Clift's evidence now have the right to have their cases reviewed, but, as there is a long delay in that process, can the right hon. and learned Gentleman assure the House that every case in which Dr. Clift gave evidence will be reviewed by the committee?

Mr. Brittan: The committee has to cover more than 1,500 cases in which Dr. Clift was involved since 1967. Obviously, special attention has been given to the 123 contested cases in which he gave evidence. I assure the right hon. Gentleman that it is a serious review and, therefore, must necessarily take time.

Liquor Licensing

Mr. Knox: asked the Secretary of State for the Home Department whether he has any plans to introduce measures to implement the Erroll committee's report on liquor licensing.

Mr. Mellor: A number of the Erroll committee's recommendations have been implemented. Since that committee reported, indicators of the harm alcohol misuse may cause have been showing a serious and deteriorating situation. In 1981 the Government issued the publication "Drinking Sensibly" to stimulate discussion and create a


background of informed public opinion, in the light of which Government strategies could be formulated. We have no plans to introduce legislation at present.

Mr. Knox: Does my hon. Friend agree that the licensing laws cause a great deal of dissatisfaction? Is there not at least a strong case for introducing limited reforms, such as those introduced in Scotland a few years ago, which are working satisfactorily?

Mr. Mellor: I appreciate the strength of opinion in favour of that approach, just as I appreciate the strength of opinion that the increasing numbers of hospital admissions through alcoholism and the increasing number of accidents where alcohol has been a factor should lead, as the Expenditure Committee recommended in 1977, to extreme caution in any liberalisation of the licensing laws.
I can offer my hon. Friend some words of comfort. We appreciate what has happened in Scotland. I understand that my right hon. Friend the Secretary of State for Scotland is beginning research into whether there is any link between alcohol abuse and relaxation of licensing laws. We shall be in a better position to consider changes in English law when the results of that reseaach are available.

Mr. O'Brien: When the Minister considers the Erroll report, will he ensure that privately run clubs—such as working men's clubs — will not be subject to interference? They are properly run clubs, managed by their members. Will the Minister assure us that the Erroll report will not interfere with such clubs?

Mr. Mellor: I have already made it clear that we have no plan to introduce legislation at present, so the hon. Gentleman need not have any fears.

Mr. Adley: Have not successive Governments recognised that the position is unsatisfactory? Does my hon. Friend agree that producing a leaflet called "Drinking Sensibly" is no substitute for action? As the Government have been elected for a five-year term, should they not take their courage in their hands and deal with a problem that must be dealt with sooner or later?

Mr. Mellor: I must correct my hon. Friend on his point about the leaflet. It was a substantial publication from the Department of Health and Social Security, which dealt seriously with the increase in alcohol abuse. While I understand that many people sincerely believe that the licensing laws could be relaxed without any adverse effect on alcohol abuse, there are many others who equally sincerely, and with equal merit, believe the contrary. On that basis, the Government would not be right to press ahead with any reform.

Mr. Meadowcroft: Does the Minister accept that many clubs — especially the working men's clubs referred to by the hon. Member for Normanton (Mr. O'Brien) — which play an important role in the community are facing increasing financial difficulties? Will he consider assisting them—[Interruption.]

Mr. Mellor: I could not hear all of what the hon. Gentleman said, but the Government certainly have no plans to nationalise clubs.

Escaped Prisoners

Mr. Favell: asked the Secretary of State for the Home Department how many prisoners who escaped from

custody in each of the past five years have subsequently been convicted (a) for homicide and (b) for other offences of violence committed whilst at large.

Mr. Hurd: Of those adult prisoners who escaped from closed prisons in 1981 and 1982, two were convicted of offences of manslaughter committed while they were unlawfully at large. Further information is not readily available.

Mr. Favell: Is the Minister satisfied with present arrangements in the light of recent offences committed by prisoners while in transit? Is he aware of recent reports that five murderers have escaped in as many weeks from one open prison?

Mr. Hurd: I cannot comment on the hon. Gentleman's last point, other than to say that I do not think he is right. We cannot be satisfied while there are a substantial number of escapes, especially of prisoners under escort. In July this year the deputy director-general of the prison service issued some practical general guidance on the subject to all governors in an attempt to improve the position.

Mr. Kilroy-Silk: Does not research from the Minister's Department show that long-term prisoners released on licence are less likely to commit further offences? Will not the Home Secretary's decision to restrict parole for certain offenders lead to the likelihood of further offences being committed by those prisoners? Will not that decision also encourage the "escape mentality"?

Mr. Hurd: That question has nothing to do with the question on the Order Paper, which deals with escapes from custody.

Drug Trafficking

Mr. Andrew MacKay: asked the Secretary of State for the Home Department if he will make a statement on illegal drug trafficking in the United Kingdom.

Mr. Brittan: The Government recognise the evidence of rapid and substantial growth in illegal trafficking of controlled drugs, particularly heroin, and are committed to action aimed at preventing illegal importation, stopping the supply within the United Kingdom and reducing it at source.

Mr. MacKay: Will my right hon. and learned Friend comment on the Lord Chief Justice's Darwin lecture, when Lord Lane made the serious allegation that the Government were doing nothing to stem what he called the flow of death—heroin from Pakistan?

Mr. Brittan: The Lord Chief Justice was doing a public service by drawing attention to the magnitude of the problem. However, it is also right to draw attention to the offer of aid for law enforcement activities in Pakistan, worth 180,000 in this financial year, which is currently being considered by the Government of Pakistan. There is close co-operation between the Pakistan law enforcement agencies and our own customs and police, and other action is being taken. I readily agree that we should look for ways to improve the position.

Mr. Alex Carlile: What steps do the Government propose to take to ensure that it is less easy for hard drugs to be stolen from chemists' shops and doctors' surgeries?

Mr. Brittan: The hon. Gentleman is referring to the report on security from the Advisory Committee on the Misuse of Drugs, which was published yesterday. The report recommends a number of improvements in security arrangements. I am urgently seeking views on its recommendations and intend to announce my decision when I have considered them.

Mrs. Kellett-Bowman: Does my right hon. and learned Friend accept that we place such countries as Thailand in a difficult position when we urge them to tighten up their defences against drug trafficking, and then raise a furore when they imprison our youngsters'? We cannot have it both ways.

Mr. Brittan: I would never raise a furore about citizens of the United Kingdom being punished for offences that would be serious offences in this country.

Mr. Skinner: How can we have any faith in a Government's attempt to control drug trafficking, or to find where the £27 million that was snatched from under the noses of the police at Heathrow has gone, when that Government are more concerned with directing police to guard the Yankee bases and to protect rogue employers such as Eddie Shah? If they got their priorities right they might control drug trafficking.

Mr. Brittan: The hon. Gentleman is not making a useful contribution to this problem.

Mr. Dubs: Is not the Home Secretary being complacent about Britain's hard drug problem, which all social agencies say is virtually out of control? What specific proposals does he have to tackle that problem?

Mr. Brittan: The hon. Gentleman has not heard me say anthing that remotely smacks of complacency. He should know that police drug squads are increasingly concentrating their resources against major traffickers. I shall be meeting representatives of the Association of Chief Police Officers later today to discuss ways in which police efforts to bring traffickers to justice can be strengthened.

Pedal Cycles (Lights)

Mr. Higgins: asked the Secretary of State for the Home Department if he will take steps to improve the enforcement of the law on pedal cycle lighting in the London Metropolitan area.

Mr. Hurd: The enforcement of the law on pedal cycle lighting in the Metropolitan police district, like the enforcement of other road traffic laws, is a matter for the Commissioner of Police of the Metropolis.

Mr. Higgins: Is my right hon. Friend aware that the number of recorded convictions for this offence during the whole of last year was rather less than the number of pedal cyclists that one is likely to observe in 20 minutes on the streets of London? Is it not a scandal that no attempt to enforce the law is being made?

Mr. Hurd: My right hon. Friend will accept that a serious attempt is being made to enforce the law with regard to cycling. It is probably sensible that, in most cases, the police should deal with the matter by way of a caution rather than by prosecution.

Sir Oswald Mosley (Interrogation Transcripts)

Mr. Madel: asked the Secretary of State for the Home Department when he expects to be able to release transcripts of the interrogation of Sir Oswald Mosley by Lord Birkett in July 1940 under the Defence of the Realm Act; and if he will make a statement.

Mr. Brittan: The review of these papers is now complete and I have decided to release for public inspection the complete transcripts of the Mosleys' hearings before the advisory committee, chaired by Lord Birkett. I have also decided to release all the other files on the detention and interrogation of Sir Oswald and Lady Mosley, with the exception of a very few files which will remain closed on security grounds. The files to be released will be made available from 12 December in the Public Record Office.

Mr. Madel: I am grateful to my right hon. and learned Friend for that reply. Will the publication of the transcripts reveal Lord Birkett's recommendation as to whether Sir Oswald Mosley should or should not be detained under the Defence of the Realm Act?

Mr. Brittan: Yes. After a lengthy hearing in July 1940, the advisory committee concluded that the order for Sir Oswald Mosley's detention should continue. The committee's full report explaining why it came to that conclusion is to be found in one of the files which will be disclosed.

Mr. Mikardo: I thank the Home Secretary for the release of the papers, especially the Birkett papers. Does he really expect us to believe that there is anything in those papers, whose age is between 40 and 50 years, that can conceivably threaten security today? What are the real reasons for holding back those papers that he is holding back? Who is being covered up?

Mr. Brittan: The hon. Gentleman's capacity for believing in the conspiracy theory is almost unlimited. I assure him that the reason for the very small number of files being kept closed—six out of about 140—has nothing whatever to do with covering up any person. They are being kept closed simply because the information in them would reveal material about the methods of the security services' operations. It would not be in the public interest to disclose that.

Football Hooliganism

Mr. Allan McKay: asked the Secretary of State for the Home Department if he is satisfied that magistrates have sufficient powers to deal with offences arising from football hooliganism.

Mr. Mellor: The penalties available for all the main offences associated with football hooliganism are substantial, and include custodial sentences. For the more serious offences, magistrates may commit the defendant to the Crown court for trial or sentence.

Mr. McKay: Has the Minister seen an article in The Guardian today which reports the chairman of the Football Association as saying that, if the Government do not introduce legislation to help with the problem of known hooligans going abroad, there is little that the Football Association can do about what happens at away matches? Will the Minister consider introducing a system such as


that employed by the Amateur Athletics Association, which has a register of supporters? Does he agree that people's names could then be withdrawn from such a register by magistrates in the event of hooliganism?

Mr. Mellor: I and my hon. Friend the Minister with responsibility for sport share the hon. Gentleman's anxiety about the disgraceful behaviour of a small minority of British sports fans when British clubs or the national team play overseas. It would be a major step to do what the chairman of the Football Association has asked. My hon. Friend the Minister with responsibility for sport is considering these matters during his regular contact with the football authorities and Ministers with responsibility for sport in other European countries.

Mr. John Carlisle: In the light of the meeting that my hon. Friend the Minister with responsibility for sport had with his counterparts in Rotterdam recently and the success of that meeting, will my hon. Friend consider meeting his European counterparts to persuade them to ensure that their magistrates come down hard on the British thugs who are bringing the good name of football into disrepute?

Mr. Mellor: My hon. Friend has raised an important point. My hon. Friend the Minister with responsibility for sport has already taken it up. Sometimes, alleged hooligans who are arrested and confined overnight do not have charges brought against them. That is most unsatisfactory from all points of view.

Oral Answers to Questions — PRIME MINISTER

Engagements

Mr. Wallace: asked the Prime Minister if she will list her official engagements for Thursday 1 December.

The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House I shall be having further meetings later today. This evening I shall be attending a diplomatic reception at Buckingham palace given by Her Majesty the Queen.

Mr. Wallace: Since the Prime Minister's return home has she had an opportunity to read yesterday's speech by the right hon. Member for Cambridgeshire, South-East (Mr. Pym) and the comments made in an interview on television during the weekend by the Secretary of State for Northern Ireland, both of whom linked unemployment with the increasing level of violence and lawlessness? Do those comments herald a new dawn of realism and understanding in the Tory party, and has it yet dawned on the right hon. Lady?

The Prime Minister: With regard to the first part of the hon. Gentleman's question, the policy that I am pursuing now is precisely the same as that which I pursued when my right hon. Friend the Member for Cambridgeshire, South-East (Mr. Pym) was a distinguished member of my Cabinet. They are also the policies on which we won the general election so handsomely. On the latter part of this question, the hon. Gentleman should refer to the excellent investigation carried out by the Social Science Research Council, which found that there was no connection between unemployment and crime.

Mr. Kinnock: In an effort to resolve the continuing dispute at the Stockport Messenger, will the Prime Minister use the power which we know she has and, at the least, get her Secretary of State for Employment to invite Mr. Shah, the National Graphical Association and the chairman of ACAS to meet the Secretary of State for discussions to pursue a resolution of the dispute and arrange for that meeting to be in London?

The Prime Minister: No, Sir. ACAS was set up by the Labour Government. It exists to act as a reconciliation agency in disputes. One of the parties involved will be seeing ACAS this afternoon. It is not the Government's function to take these matters over.

Mr. Kinnock: We have heard much of the Prime Minister's policy of non-intervention. On 14 October Mr. Shah obtained his first two injunctions under the 1980 and 1982 legislation. That was also the day on which the Prime Minister met Mr. Shah in the north and—[Interruption.] If the Prime Minister wants photographic evidence I have it here. The Sale and Altrincham Messenger of 21 October carries two photographs of the Prime Minister in deep conversation with Mr. Shah. [HON. MEMBERS: "Oh"] So much for non-intervention. When she met Mr. Shah, did she counsel peace or conflict? Did she advise him to pursue industrial relations by litigation or by negotiation?

The Prime Minister: I advise everyone, employer or employee, to keep within the law, because the law is their best protection. I do not discuss particular industrial relations problems with particular employers. Will the right hon. Gentleman advise the NGA to obey the law and to purge its contempt of court?

Mr. Kinnock: The Prime Minister has not answered the question. She is refusing to give an honest answer to the question. Is she really trying to persuade the House that on the very day that this business man went to court and got two injunctions, she, as the authoress of the two pieces of legislation that gave rise to the injunction, did not discuss this matter with him? Is not the fact that the Conservative party and the alliance parties want this dispute to be more bitter and more prolonged for purposes of political profit, when we on the Opposition Benches, and every reasonable person, want the dispute to be resolved so that we can have peace in the printing industry and on Fleet street?

The Prime Minister: This dispute is about an attempt to impose—[Interruption.]

Mr. Speaker: Order. The House must listen in silence to the Prime Minister. [Interruption.] Order. I repeat what I said yesterday—if we cannot have order in this House, how can we expect it outside?

The Prime Minister: This dispute is about an attempt to impose a closed shop on employees, who did not want it, by a process of union intimidation, and further to prevent that company from producing a newspaper by unlawful picketing under the criminal law. The employer has rightly sought the protection of the courts. The protection of the law is there for every citizen in the land and it is to be used. The law is wholly separate from politics.

Mr. Nichol: as Baker asked the Prime Minister if she will list her official engagements for 1 December.

The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.

Mr. Baker: Is my right hon. Friend aware of the support that she will receive in the negotiations next week in Athens, and does she accept that the own resources of the Community should not be increased unless arrangements on the budgetary process and the common agricultural policy are arrived at that are satisfactory to the House?

The Prime Minister: Yes, I firmly agree. The objective at Athens is to achieve a fair sharing of the financial burden of the Community among the several members, so that no member pays to the Community a share disproportionate to its relative prosperity. It is particularly important that we get a safety net for our contribution. It is also very important that we get control of expenditure under the Community budget, and in particular under the common agricultural policy.

Mr. Steel: Does the right hon. Lady recognise that she should tell the House what was the advice that she gave to Mr. Shah? However, does she agree that, regardless of the more recent legislation, the mass picketing that is going on was illegal under the Labour Government's legislation, and that that should be condemned, and hon. Members participating in those pickets should be repudiated by their party leader?

The Prime Minister: I do not advise anyone upon the law. That is a matter for their professional advisers and their solicitors, and most wise politicians would take that view. With regard to the mass picketing, that is a matter for the criminal law. That has been the position for decades, certainly long before our last legislation.

Mr. Dickens: I congratulate my right hon. Friend on a first-class Commonwealth conference. Following the long statement by Mr. Mugabe, does my right hon. Friend now feel that there is a real hope for the British airmen still imprisoned in Zimbabwe — and for their families — of early release?

The Prime Minister: I saw Mr. Mugabe in Delhi at the Commonwealth conference and we had a conversation in which this issue arose. I understand that the fourth of the air force officers was released when his case came before a review tribunal, which recommended his release. I understand that the other three cases will come before the review tribunal and go through the usual process, we hope with the same result.

Mr. Merlyn Rees: Has the Prime Minister been advised on the allegation made while she was away that an eminent member of the judiciary was acting as adviser to one of her Departments, and that the Home Secretary yesterday said that the facts had been distorted? What were the facts?

The Prime Minister: I am not in a position to comment — [Interruption.] — on double hearsay. I have full confidence in the judiciary, which is independent of politics and must remain so.

Mr. Ray Powell: asked the Prime Minister if she will list her official engagements for Thursday 1 December.

The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.

Mr. Powell: Before the right hon. Lady replies to my question, she should give a reply to my right hon. Friend the Leader of the Opposition, who presented her with a question that has not yet been answered. In the meantime, will she read in today's Official Report the Standing Order No. 10 application made by my hon. Friend the Member for Linlithgow (Mr. Dalyell), in which he inquired whether she was aware of what had transpired in the Peruvian peace talks and had been informed on 2 May before the sinking of the Belgrano—[HON. MEMBERS: "Oh".] All the information that was contained in yesterday's application came from the Wall Street Journal. Will she now decide whether she will take legal action against that newspaper for fabrication, or will she make a statement to the House and tell the truth, the whole truth and nothing but the truth?

The Prime Minister: I read the Standing Order No. 10 application and I read the report, the information in which is totally and utterly wrong.

Mr. Budgen: Is my right hon. Friend aware of a widespread demand on the Conservative Benches for the publication of a document setting out the political priorities for containing public expenditure m this Parliament, and will she give her support to the publication of such a document?

The Prime Minister: Obviously we are looking at the long-term consequences of the present trend of public expenditure. We shall let my hon. Friend and other hon. Members have as much information as we possibly can. We must have the information to make a proper assessment of the taxation consequences of certain levels of public expenditure.

Mr. Speller: asked the Prime Minister if she will list her official engagements for Thursday 1 December.

The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.

Mr. Speller: Is my right hon. Friend aware that the Post Office Engineering Union imposed a weekly levy of £1 on all its members, to be used solely for political purposes. In view of this, will she consider recommending to the chairman of British Telecom that an alternative union, the Engineering Officers Technical Association, be empowered to act and negotiate on behalf of the technical officers, who would prefer to belong to a union that worked for them rather than to a union that works largely for political purposes?

The Prime Minister: I understand my hon. Friend's concern, but it is for the chairman of British Telecom to take whatever decisions are in the best interests of the business. I understand that some members of the POEU have been reluctant to pay the levy. That shows that they have made a better assessment than some of their leaders of the benefits of privatisation.

Mr. Robert C. Brown: Will the Prime Minister reconsider the decision to increase fuel prices at a time when the British Gas Corporation could reduce prices by 10 per cent. and carry on making its current profits? If riot, will the right hon. Lady accept that she is setting herself up as jury, judge and executioner of many sick, disabled and elderly people? Does the right hon. Lady relish the prospect of becoming a mass murderer in coming winters?

The Prime Minister: I have already answered that question. The amount of gas is limited. Present supplies are made up in large part of cheap gas from the southern basin of the North sea at 6p a therm, progressively supplemented by imported gas at 19p a therm. It is therefore inevitable that gas prices will rise over the years. To keep them artificially low would be to use gas in this generation at the cost of the future. That would be a short-sighted policy. If the hon. Gentleman will refer to his own Government's record on gas prices he will find that they deliberately loaded gas prices on to industry in order to keep them down for the consumer. The most recent Labour Government loaded gas prices on to industry to the tune of 291 per cent. We have done it only to the extent of 85 per cent.

Oral Answers to Questions — Royal Assent

Mr. Speaker: I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has notified Her Royal Assent to the following Acts:

1. Oil Taxation Act 1983.
2. Pwllheli Harbour Act 1983.
3. Greater London Council (Money) Act 1983.
4. Severn-Trent Water Authority Act 1983.
5. Standard Chartered Merchant Bank Act 1983.

Commonwealth Heads of Government (Meeting)

The Prime Minister (Mrs. Margaret Thatcher): I will, with permission, Mr. Speaker, make a statement on the Commonwealth Heads of Government meeting which I attended in New Delhi and Goa from 23 to 29 November. My right hon. and learned Friend the Secretary of State for Foreign and Commonwealth Affairs also attended for the first three days. I have arranged for the communiqué to be placed in the Library of the House.
Two specific matters—Grenada and Cyprus—were considered early in the proceedings. On Grenada there was a long and detailed debate. Heads of Government decided to concentrate on the future, not the past — on reconstruction, not recrimination. They welcomed the establishment of an interim civilian administration, looked forward to free and fair elections, and confirmed their willingness on certain conditions to consider sympathetically Grenadian requests for assistance.
There was also a more general discussion of the practical need to give greater security to small states, many of them islands, not only in the Caribbean but elsewhere in the Commonwealth. The Secretary-General was asked to undertake a study of the problem. As the House knows, this is a matter to which Her Majesty's Government are also giving thought. Regional groups may have a special role to play.
With regard to Cyprus, Commonwealth leaders fully endorsed United Nations Security Council resolution 541 which deplored the Turkish Cypriot declaration of secession as legally invalid, requested the United Nations Secretary-General to pursue his mission of good offices, and called upon the parties to co-operate fully. But it was also felt that the Commonwealth should itself try to help bring about a solution, and an action group was established to assist in implementation of the Security Council resolution. Britain is not a member of that group as we already have a particular role as a guarantor power.
Among the other specific subjects, Southern Africa was discussed at length. We considered the implementation of the United Nations plan for Namibian independence and the present obstacles to its achievement. The concept of a conditional link between the independence of Namibia and the withdrawal of Cuban troops from Angola was rejected, but clearly the fact that other nations have made the linkage is material to how and when the problem will be resolved.
On more general matters, the meeting issued two declarations. The main theme of the Goa declaration on international security is that at a time of heightened tension in the world the first objective must be to re-establish a constructive dialogue between East and West, by increasing contacts and by rebuilding a climate of confidence. We support that objective.
The statement on economic action deals with current international economic problems, notes that all countries have a responsibility for pursuing prudent domestic economic policies and recognise the need for the Bretton Woods institutions to be adapted and better equipped to deal with the problems of the international economy. It was decided to establish a consultative group, on which the United Kingdom will be represented, for the purpose of

promoting wider agreement on the issues that we discussed. The group will report to Commonwealth Finance Ministers before their 1984 meeting in Toronto.

Mr. Neil Kinnock: I thank the right hon. Lady for her statement. We are all glad to see her on her safe return.
Will the right hon. Lady assure the House that she will be more active in fulfilling the purposes of the New Delhi communiqué than she was in pursuing the purposes listed in the Melbourne communiqué which was issued after the last conference of Heads of Government? In Melbourne the Prime Minister urged all Governments to
desist forthwith from any collaboration with South Africa which undermined the implementation of the arms embargo".
However, her own Government has since then acted in precisely the opposite direction, permitting serious military collaboration with South Africa, including military radar sales.
We nevertheless welcome the Government's support for United Nations resolution 539 and the commitment in the Heads of Government communiqué to the adoption of appropriate measures under the United Nations charter should South Africa continue to obstruct the implementation of the independence plan.
There is a somewhat cryptic sentence in the statement that refers to the fact that
other nations have made the linkage
and that that
is material to how and when the problem will be resolved
What does that sentence mean? Can the Prime Minister allay our fears that she may already be relinquishing the position that she took up at the United Nations on 28 October and at the New Delhi conference this week? Which measures may she consider to be appropriate if South Africa continues to impede progress on Namibia?
Bearing in mind how far other Commonwealth and non-Commonwealth Governments have gone in implementing the principles of the Gleneagles agreement, and recognising the fact that by far the largest number of sporting visitors to South Africa are from this country, can the right hon. Lady tell the House how she intends to give greater effect to her renewal in New Delhi of the commitment to the Gleneagles agreement?
Given the Prime Minister's support for the section of the communiqué which reaffirms support for the principles of independence and non-intervention in the affairs of other states, sovereignty and territorial integrity, may I—in a spirit of reconstruction and not recrimination—ask the Prime Minister what measure she intends to take to ensure that other countries, including the United States, accept similar commitments on independence and nonintervention?
Why was the Prime Minister so obdurate in her opposition to the widely supported initiative of Mr. Robert Muldoon for a new international conference to consider the reform of the world trade and financial institutions set up at Bretton Woods 39 years ago? Why, even when a compromise was reached on that proposal, did the right hon. Lady let it be known that she did not consider that Britain is bound by the decision of Commonwealth Heads of Government to seek an international conference with universal participation simply to review international monetary and trade problems?
Does the Prime Minister still take the same simplistic view of economic affairs that she did at the start of the New


Delhi conference? Is she still lecturing people without shoes on how to pull themselves up by their own bootstraps?

The Prime Minister: This country has fully honoured the military arms embargo on South Africa. Certain equipment is suitable for both civilian and military use. Sale of that equipment did not offend the mandatory arms embargo.
The right hon. Gentleman asked about linkage. As I have said, we do not recognise a direct linkage between the presence of Cuban troops in Angola and the independence of Namibia, as my right hon. Friend the Foreign Secretary has made perfectly clear. Other people do, and denouncing by rhetoric will not wish away the linkage. We must continue to try to persuade. The meeting of the contact group of Ministers will take place again in London in December.
We have upheld the Gleneagles agreement. It is one in which the Government cannot coerce people, even if the right hon. Gentleman would wish them to do so.
We have given our views on Grenada. This does not seem the time to go over the past, but to try to help constructively with the future. Other countries must reach their own decisions about how they honour non-intervention in the affairs of other states and of not crossing other borders.
With regard to economic affairs, the Commonwealth Finance Ministers conference was exactly in accord with my view that a contact group should be set up to consider whether any steps need to be taken to improve the existing institutions. If it reached certain conclusions, that might eventually lead to an international conference. We see no need for one at the moment. The rest of the Commonwealth agreed with me and not the right hon. Gentleman.

Mr. David Steel (Tweedale, Ettrick and Lauderdale): Will the Prime Minister confirm that she disagreed with the New Zealand Prime Minister on that last point, as she disagreed with the Canadian Prime Minister on the need for a nuclear power summit and with the majority of the conference condemning the South African constitutional referendum as fraudulent on the grounds that it did not involve the majority of the population? Did she find that everyone except her was out of step?

The Prime Minister: If the right hon. Gentleman reads the economic communiqué, he will see that it fully expresses my view, and that it was agreed to by the conference as a whole. He has it wrong. After discussion, the conference accepted my view. As there are many international debt problems still to be solved, it is not surprising that many members took the view that it was far better to strengthen the authority, and adapt and extend the scope of the existing institutions, than to undermine them. That view is included in the communiqué.

Mr. Dennis Skinner: That is what the Liberal News said.

The Prime Minister: That was the view that I took at the outset. The right hon. Gentleman's other question was about South Africa. He used the word "fraudulent" about the differences in the franchise which have recently been put in a referendum to the white population. I did not

dissent from that part of the communiqué, but I would not have used the word "fraudulent". It would help matters in South Africa to go in the way in which we would like — steadily to abolish apartheid — if we were to encourage those many people in South Africa who are working precisely for that.

Mr. Julian Amery: I appreciate that there is no automatic linkage between the withdrawal of South Africa from Namibia and the Cubans from Angola, but does my right hon. Friend agree that a higher priority should be given to the withdrawal of Cubans, who are non-African, and Soviet stooges from Angola than to get the South Africans, who are Africans, out of Namibia? Did she make representations to Mr. Mugabe about the detention without trial of our friend Bishop Abel Muzorewa?

The Prime Minister: With regard to Angola and Namibia, again, one would have preferred an injunction about the withdrawal of all foreign troops, which would seem to be fair. We were not able to achieve that because certain people within the Commonwealth took a very different view. In drafting these communiqués, one has to reach a view which can be represented in them. As my right hon. Friend knows, I should have preferred the withdrawal of all foreign troops, including the Cubans, and any South Africans who may be in Angola.
I did not raise the subject of Bishop Abel Muzorewa with Mr. Mugabe. That seems to be to an internal matter for Mr. Mugabe.

Mr. Jack Ashley: Did the Prime Minister have a guilty conscience at the conference about the fact that British overseas aid has been cut to 44 per cent. of the GDP — one of the lowest in western Europe—or did she lecture it on the need for efficiency savings?

The Prime Minister: As the right hon. Gentleman knows, our aid programme this year is about £1·1 billion. I must point out to him, although he may not like it, that the Commonwealth thanked me for once again making efforts to get the IDA round 6 moving. Without our efforts it would not have been fully replenished. The Commonwealth asked me to do the same on IDA 7.

Mr. Ian Lloyd: As there is little sign of what would be a welcome retreat as a result of his statements or actions from what is certainly the studied arrogance of the Marxist or the paranoid suspicion of the successful terrorist, what evidence can my right hon. Friend give the House of a single action to justify her saying to Mr. Mugabe, or Mr. Mugabe saying to her, that British citizens have been involved in the subversion of that sad and sorry state which has succeeded Rhodesia? If there is such evidence, and if Mr. Mugabe can make it available, will he enable us to see and study it so that we can judge its accuracy, because we have the gravest doubts about most of the disinformation which proceeds from the so-called front line states?

The Prime Minister: I am not certain which person my hon. Friend is getting at. I have said that the subject of the air force officers arose, what happened, and how it would be resolved. We must consider how best to secure the release of those people. I believe that their cases will go before the tribunal. I hope that my hon. Friend will accept that the judicial process in Zimbabwe was impeccable.

Mr. Tom Clarke: Was the Prime Minister impressed by the strong feelings that apparently existed about the proliferation of nuclear weapons? If she was, what support, if any, did she give to Mr. Pierre Trudeau's initiative?

The Prime Minister: The hon. Gentleman will find a reference to nuclear proliferation in the communiqué. It is rather elliptical, because some of the non-aligned states strongly took the view that they would not sign that nonproliferation agreement. They were prepared to include a sentence in the communiqué which sought to decrease the number of nuclear weapons and to prevent their further spread. We could not go beyond that.

Mr. Mark Robinson: I congratulate my right hon. Friend on her contribution to what, by all accounts, was a highly constructive and successful Commonwealth meeting. Did she make any specific suggestions about the restoration of democracy in Grenada in the context of how the British Government might be able to give assistance?

The Prime Minister: We should give assistance, if asked, in two ways. The first is by providing police or making arrangements for training the police. We have helped with the supervision of elections in Zimbabwe and Uganda, and the Commonwealth has helped in other places. We could help with internal, non-military security and the arrangement of the elections. We have to be asked. There is an advisory council advising the governor-general and he knows that we shall be sympathetic to any claim made upon us. As my hon. Friend knows, we have just announced £750,000 of aid to Grenada to help initially.

Mr. Jeremy Corbyn: What was the reaction of other Commonwealth Heads of Government to the continued cut in British aid to Grenada between 1979 and 1983 and the decision to increase aid to that country following the American invasion? Does she agree that it is the business of the people of Grenada to decide their future, and when and if they should hold elections rather than President Reagan and herself?

The Prime Minister: On independence, a sum of £2 million was allocated for capital developments in Grenada. At the time of the trouble there, about £88,000 of that amount was still outstanding. We have tried to help Grenada by making another injection of aid of about £750,000. It is, of course, a matter for the governor-general, as advised by the advisory council, to determine when elections shall be held. Naturally, having had a Marxist Government since 1979, elections are a new thing there, and it will be necessary to compile all the registers effectively and reform the political parties.

Mr. Cranley Onslow: Although it is good news that the discussions at Delhi seem to have led to a wider all-round understanding of the problems of the eastern Caribbean generally and of the need to provide effective protection for the small states there against the many threats they face, will my right hon. Friend say whether she would be willing, in principle, for this country to make a significant contribution to a regional security pact? Does she accept that the British garrison in Belize makes an important contribution to the integrity of that

country, and that there can be no question of withdrawing it unless and until a similar regional security pact prevails there?

The Prime Minister: As I said in my statement, the Commonwealth is now carrying out a study of these important matters. We have created a number of very small independent states all over the world, which are incapable of defending their sovereignty. We now have to consider, following the events in Grenada, whether through a series of regional pacts we can do something to help them together to defend their sovereignty, but there are some places where that would be difficult.
I am very much aware of the enormous contribution made by the presence of British forces in Belize, both soldiers and a Harrier force. En fact, Belize is an oasis of democracy in a troubled central America, and it may be possible that that could play a part in a regional pact. It is better for us to spend some time, as I am sure my hon. Friend would agree, in fully considering the matter before reaching any premature conclusions.

Mr. J. D. Concannon: Now that our country's relations with Mr. Mugabe and Zimbabwe seem to be improving, may I point out to some Conservative right hon. and hon. Members who criticise the judiciary of another country, that it is not many years since the right hon. Lady was a member of a Conservative Government under whom people were declared innocent in a part of the United Kingdom, re-arrested on the steps of the court, and interned?

The Prime Minister: The right hon. Gentleman is referring to Northern Ireland. I am very much aware of the steps that were taken at that time.

Sir John Biggs-Davison: While I share and applaud my right hon. Friend's concern for the white air force officers imprisoned in Zimbabwe, may I ask her whether she shares the concern of many of us for the fate of Bishop Abel Muzorewa, who was freely elected as Prime Minister of that state in elections which were internationally observed and recognised as fair, and who now lies in imprisonment and is probably in great danger?

The Prime Minister: Yes, of course. One does not distinguish between the citizens of a country in demonstrating one's concern. I hope that that is perfectly clear.

Mr. Allan Roberts: The Prime Minister glossed over the conflicts at the Commonwealth conference about the invasion of Grenada. Is she aware that one of the parties to that invasion, Prime Minister Seaga, is at present in the process of setting up a one-party state in Jamaica because of the method by which he has prematurely called a general election? Will the right hon. Lady undertake to ensure that if Britain participates in any Commonwealth peacekeeping force, having talked about political parties being allowed to regroup, the new dual movement will be allowed to put forward candidates in any election that takes place in Grenada?

The Prime Minister: I guess that there are many countries that would love to have a general election on their hands now, and who have never had or known what a general election means. [HON. MEMBERS: "Hear, hear."] I am certain that if we had one here today the result would be even more in our favour as a result of the Labour party's performance recently.
In answer to what the hon. Gentleman said about Jamaica, may I say that it is perfectly open to Mr. Seaga to call a general election. What is wrong with that?

Mr. David Crouch: While there is a great advantage in a meeting of 48 nations and their Prime Ministers considering problems particularly concerning themselves and the Commonwealth, is there not here an element of a lost opportunity when 48 powerful and influential nations do not issue a declaration from Delhi on the situation in the middle east, so guiding the Western world on how to solve that vital problem?

The Prime Minister: There is a section in the communiqué on the middle east. Clearly, with the situation as it is, we could not possibly have met without discussing it. We included a section on it in the communiqué, and in particular on the Lebanon, in which we called for a withdrawal of all foreign forces, except those which are there at the request of the Lebanese Government, those being, of course, the United Nations force and the multinational force, and hoped that Lebanon would again become a fully sovereign and independent country.

Mr. Dick Douglas: Will the Prime Minister tell us about her discussion with the Commonwealth Prime Ministers about the possible linking of the START talks with the INF talks, and also matters affecting the common heritage of mankind? How did she explain to the Commonwealth Prime Ministers her Government's failure to sign the third United Nations convention on the law of the sea and her Government's attitude to the development of the Antartica treaty?

The Prime Minister: In answer to the hon. Gentleman's question about the START talks and the INF talks, we did not discuss any possible merging of the two. I was sorry that the Soviet Union chose to walk out of the INF talks when it did.
We have made our views perfectly clear on the law of the sea. The arrangements for the mining of the seabed are not sufficient for us to sign them, and the convention could act very adversely to our interests. We have taken a correct view on Antartica. There is another conference on it.

Mr. Nigel Forman: Although I share my right hon. Friend's preference for strengthening and adapting the international economic institutions of the Bretton Woods era, was there any discussion in Delhi, or do the Government intend to press forward with proposals to give the IMF a more advanced role to help developing countries, and also to give GATT a more thorough-going role in dealing with the problem of non-tariff barriers?

The Prime Minister: The IMF has adapted extremely well and played a foremost role in solving the great debt problems. While my right hon. and learned Friend the Foreign Secretary was chairman of the interim committee, the funds available to the IMF were greatly extended. I think that the IMF is to be congratulated on the way it has tackled the problem. Without it we should never have had a resolution of the debt problems of many countries, nor the aid of some commercial banks which has been made available because of the disciplined conditions rightly demanded by the IMF as a condition of loans. After all,

one gives extra loans to a country that is in debt, not for it to carry on in the way that got it into debt, but to enable it to get out of debt and carry on by way of prudent housekeeping. So I think that has been well done.
With regard to GATT, we had a long discussion on protectionism, but it is not enough to pay lip service to protectionism. As my hon. Friend knows, the world is riddled with protectionism and the danger is that some people may try to reduce the barriers while others leave them up. Therefore, it is absolutely vital that we move together both on the tariff barriers and the non-tariff barriers.

Mr. James Lamond: In the section of the right hon. Lady's statement dealing with East-West relations she mentioned the necessity of increasing co-operation and dialogue. Can she tell us whether anyone at the Commonwealth conference asked her to explain why she defeated the object of the Geneva talks by allowing the cruise missiles to be deployed in Britain and thus increase the danger and tension not only to Europe but the whole world, including the Commonwealth?

The Prime Minister: I think that the hon. Gentleman is talking nonsense. He knows full well that during those talks, while we were trying to negotiate disarmament on intermediate weapons with the Soviet Union, the Soviet Union continued to deploy one SS20 a week——

Mr. Lamond: No.

The Prime Minister: —while we were trying to negotiate their reduction. It was utterly wrong for Russia to walk out of those talks while we were just beginning to deploy cruise and Pershing. Had she agreed to dismantle her SS20s totally no cruise or Pershing need have been deployed.

Mr. K. Harvey Proctor: What representations did my right hon. Friend receive from other Heads of Commonwealth Governments for my right hon. and learned Friend the Foreign Secretary concerning the Prevention of Terrorism Bill and in particular clause 12 of it dealing with international terrorists? I realise this is a detailed question. Perhaps my right hon. Friend will write to me if she is not in a position to reply now.

The Prime Minister: There were no representations, but if my hon. Friend will let me know the point he has in mind I will, of course, reply to him.

Mr. Nigel Spearing: By what means were the hopes, fears and aspirations of the people of Grenada made available to the Commonwealth conference? Is it not a fact that the general feeling was that the sooner a Commonwealth security force replaces that of the United States in Grenada, the better? Was this view transmitted to President Reagan, and on what factors does its implementation depend from the Prime Minister's point of view?

The Prime Minister: It is not for us to say now who shall go into Grenada. It is for the advisory council which advises the governor-general to express its wishes and to ask for help which it knows will be readily available; it is not for us to impose a particular force upon Grenada. Obviously the eastern Caribbean countries and the rest of the Caribbean countries are very closely in touch with Grenada and are able to transmit the views of the people.

Mr. Bowen Wells: Can my right hon. Friend the Prime Minister say whether there was any discussion at the Commonwealth Heads of Government meeting on the subject of subversion of constituent states of the Commonwealth? I refer particularly to the subversion of Grenada by the People's Revolutionary Army which led to the unfortunate events of the past six weeks. Did the Commonwealth Heads consider any method of preventing a recurrence?

The Prime Minister: We considered the problem. As my hon. Friend will see, the communiqué refers to both external and internal interference which is a direct reference to subversion, but it is a problem and will be considered along with the others. It is a problem that some of the small states cannot afford to ignore.

Mr. Norman Atkinson: Is there not something hypocritical about a Commonwealth proclamation which calls for a resumption of intercommunal talks in support of the de Cuellar initiatives when neither of those initiatives can be proceeded with until there is a withdrawal of Turkish troops and we now know that neither the British Government nor the American Government have spoken to Ankara and called for the withdrawal of Turkish troops?

The Prime Minister: I am not quite sure from where the hon. Gentleman gets that information or, indeed, whether it is correct, but I think it would be totally wrong for the Commonwealth or anyone else to do nothing in this circumstance. It may be that by getting talks going between President Kyprianou and Mr. Denktash one might be able to help to restore the unitary state of Cyprus. One cannot do it just by leaving the situation as it is.
If the hon. Gentleman looks at the full communiqué on the United Nations Security Council Resolution he will see that it was sponsored by this country and very well voted upon. It was a very good resolution. There is one other aspect, of course. Britain is a guarantor power. Under the 1960 treaty it has the duty of calling together the three guarantor powers, Turkey, Greece and ourselves, if we can manage to get the three together. If we cannot, it is possible that—[Interruption] The problem is that they do not all accept the invitation to sit together.

Mr. Richard Hickmet: First, does my right hon. Friend accept that the regime of Mr. Kyprianou is illegal under the 1960 treaty of independence? Secondly, does she accept that the root cause of the Cyprus problem has been the continuing desire of the Greeks, both on the mainland and in Cyprus, to achieve Enosis or union with Greece and the consequential persecution of the Turkish minority? Thirdly, does she accept that the Turks intervened in 1974 following the coup d'etat of Mr. Nicos Sampson, a notorious murderer, organised by the Greek junta? Fourthly, did she point out to Mr. Kyprianou that his own Foreign Minister, Mr. Rolandis, resigned following the refusal of Mr. Kyprianou to negotiate without the soundings of the Secretary-General published in September?

The Prime Minister: I cannot accept quite a lot of what my hon. Friend has said. One of the reasons why the guarantee was not invoked in 1974 was the fact that Archbishop Makarios was brought down by action by the Greeks and at that time the Turks walked in. So one of the

problems was that the two guarantor powers were involved at that time. At present it would seem that we should be able to invoke the guarantor powers in the sense that we ought to be able to get the three together. Whether we can remains to be seen.

Mr. Skinner: Is the Prime Minister aware that she should not be too hard on the Liberal party leader when he asks questions about alliances and such like because while she has been away the Liberal News has printed an article stating that the alliance is in the knacker's yard?

Mr. Speaker: Order. That is not to do with the Commonwealth conference.

Mr. Skinner: With due respect, Mr. Speaker, it is all about the fragility of the alliance and otherwise.
On the question about updating Bretton Woods and so on, did any of the poorer Commonwealth countries just put the idea into the Prime Minister's head or into other people's heads that merely propping up a few Governments or a few more banks is no answer to all those starving millions in some of the underdeveloped countries where the kids are on matchstick legs and have potbellies? Surely there must have been some people in the Commonwealth who felt that the answer was to make sure that if any money was available in the world it should go to them rather than to allow the bankers to make even greater profits?

The Prime Minister: The poorest countries obviously need aid and it is part of the relief that priority should be given to the poorest countries. That is not always so because many people prefer to go not for them but for intermediate ones. We had a discussion about the problem the hon. Gentleman has raised. It is, of course, closely connected with population control.

Mr. John Carlisle: I congratulate my right hon. Friend on resisting the attempts by other Commonwealth leaders to stiffen the Gleneagles agreement and, indeed, upholding the rights of British sportsmen to play wherever they like and against whom they like. When future tours are proposed such as the English rugby tour to South Africa next year, while she will be expected to discourage the tour, would she in the same spririt give the House the categoric assurance that no undue pressure will be put upon them or individuals to prevent them from going?

The Prime Minister: The Gleneagles agreement was affirmed and it is voluntary, but I must make it clear that we genuinely discourage the rugby tour of South Africa.

Mr. Alfred Dubs: Can the Prime Minister say whether the Commonwealth countries were agreed on policies towards Cyprus or whether some of them favour recognising the illegal regime in the north? Furthermore, does she accept that the criticism of her is not that the British Government have been doing too much but that they have been doing too little as a guarantor power? Is there not a real need—and was this need not voiced by other Commonwealth countries to her — to bring pressure to bear on the regime in Ankara without which Mr. Denktash cannot survive?

The Prime Minister: I was in touch with the President of Turkey and I indicated our views. The Government were in touch with Turkey well before the declaration because we were anxious that the declaration should not


be made. We did everything to prevent that from happening. Turkey is the only country which has recognised the illegal regime. None of the Commonwealth countries has recognised it and nor, as far as I am aware, has any other country. The duty under the treaty is to get the three guarantor countries together to consult together. We have twice tried to do that but so far have not been successful. The two other countries have each put conditions upon their attendance that are incompatible with each other.

Mr. Eric Deakins: Does the Prime Minister agree that the Commonwealth has a useful role to play in revitalising the north-south dialogue between rich and poor countries? If so, what form does she think that that might best take?

The Prime Minister: It was obvious from the debates that one of the most valued things is Commonwealth technical co-operation. It is especially valued by the smaller states. The Commonwealth is an organisation through which one can provide that sort of help. We discussed wider issues, including IDA replenishment. The current offer of $9 billion is clearly not enough, but I believe that the 416 billion that is desired is unobtainable.

Mr. David Alton: Did the Prime Minister get the chance in New Delhi to raise the issue of the readmission of Pakistan to the Commonwealth? Was she able to raise with the Indian Prime Minister the holding of a long overdue plebiscite in Kashmir? Was she able to discuss the declining number of Commonwealth students coming to our universities and colleges as a result of the introduction of full-cost fees for overseas students?

The Prime Minister: The question of the readmission of Pakistan was not raised at the conference. If Pakistan were to wish to come into the Commonwealth and the Commonwealth wished that to happen, we would, of course, support it, It is a matter for the whole

Commonwealth and not for one country. I did not talk with Mrs. Gandhi about a plebiscite in Kashmir. I said that £46 million had been made available over three years to assist students from the Commonwealth countries to come to Britain.

Mr. Ioan Evans: The Commonwealth conference has given a clear lead on a number of issues, although it had to reach a consensus on the nuclear arms race, Grenada, Namibia, South Africa and the north-south dialogue. What action do the Government propose to take to implement the recommendations, especially the recommendation contained in the Goa declaration about improving East-West relations? Will the right hon. Lady undertake to return to the House to report on what the Government are doing?

The Prime Minister: The hon. Gentleman will be aware that I have made three speeches on lines similar to the Goa declaration. I have announced that I shall be going to Hungary in the new year. I hope that there will be far more contacts than we have had recently, both at official level and political level, and that we shall see them gradually work up in that way.

Early-day Motions

Mr. Ray Powell: On a point of order, Mr. Speaker. On Thursdays we normally have available a copy of the full Vote so that we can see what early-day motions have been placed on the Order Paper. The Vote has not been available since half-past 12 today. Therefore, a number of us do not have copies of the full Vote. I appreciate that perhaps over 100 Conservative Members would like to see their names attached to a particular early-day motion that they might have signed. Some Labour Members would like to refer to it in business questions.

Mr. Speaker: The Vote was available earlier in the day because I saw the names to which the hon. Gentleman has referred. I shall make inquiries to ascertain why it is not available now.

Business of the House

Mr. Neil Kinnock: May I ask the Leader of the House whether he will state the business for next week?

The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): Yes, Sir.
The business for next week will be as follows:

MONDAY 5 DECEMBER—Second Reading of the Rating and Valuation (Amendment) (Scotland) Bill.
Motion relating to the Supplementary Benefit (Single Payments) Amendment Regulations.
TUESDAY 6 DECEMBER — Remaining stages of the Education (Grants and Awards) Bill.
Debate on the first report from the Select Committee on Procedure (Finance) in Session 1982–83.
WEDNESDAY 7 DECEMBER—Until about seven o'clock, Second Reading of the Town and Country Planning Bill.
Afterwards a debate on European Community documents on Fisheries.
The relevant document numbers will appear in the Official Report.
Motion on European Community document No. 10322/82 Protection of Workers from Noise at Work.
THURSDAY 8 DECEMBER — Motions on the Appropriation (No. 3) (Northern Ireland) Order and on the Northern Ireland (Emergency Provisions) Act 1978 (Continuance) (No. 2) Order.
FRIDAY 9 DECEMBER—Private Members' Bills.
MONDAY 12 DECEMBER — Until seven o'clock Consideration of Private Members' Motions.
Afterwards, remaining stages of the Coal Industry Bill.

Debates on 7 December

Documents and Relevant Reports of the European Legislation Committee:

(1) FISHERIES DEBATE

Documents and Document Numbers

a. 7021183 TACs and Member States' shares 1983.
b. 7022/83 Conservation of fishery resources: technical measures.
c. 7955/83 Technical measures for the conservation of fishery resources: mackerel.
d. 7973/83 Fishery resources: allocation to Norway in North Sea.
e. 8126/83 Fishery resources: interim allocations of herring in North Sea.
f. 8076/83 TACs and Member States' shares 1983. +Amendment.
g. 10158/83 Fish guide prices 1984.
h. 10568/83 Fishing activities: waters under sovereignty jurisdiction.
i. un-numbered TACs: eastern saithe stock in 1983.

Relevant Reports of the European Legislation Committee:

a. HC 78-i (1983–84) para. 7.
b. HC 78-i (1983–84) para. 6.
c. HC 78-i (1983–84) para. 16.
d. HC 78-i (1983–84) para. 13.
e. HC 78-i (1983–84) para. 14.
f. HC 78-i (1983–84) para. 8 and HC 78-ii (1983–84) para. 3.

g. HC 78-iv (1983–84) para. 9.
h. HC 78-vii (1983–84) para. 7.
i. HC 78-vii (1983–84) para. 6.

(2) DEBATE ON PROTECTION OF WORKERS FROM NOISE

Document No. 10322/83.

Relevant Report: HC 34-x (1982–83) para. 4.

Mr. Kinnock: I am grateful to the right hon. Gentleman for his statement. On Monday the Opposition will vigorously oppose the Second Reading of the Rating and Valuation (Amendment) (Scotland) Bill. Do the Government propose to take powers similar to those in. that Bill for forthcoming legislation for England and Wales? I refer to the powers that limit contributions from local authority rate funds to their housing revenue accounts, thereby forcing up their rents.
Pressing matters are facing the aerospace industry, which is of economic and strategic importance to the nation. There is a particular need to make a speedy decision on the A320 airbus project. Against that background, I ask the right hon. Gentleman to make Government time available for a debate on these matters before the end of the term, or earlier if possible.
Bearing in mind the right hon. Gentleman's natural concern for the welfare of hon. Members on both sides of the House, I draw his attention to early-day motion No. 312, the terms of which are the same as the amendment which the Opposition have tabled for this afternoon's debate.
[That this House believes that the own resources of the European Community should not be increased.]
I am worried that 66 hon. Members appear to have disappeared overnight.

Mr. Biffen: The topic of early-day motion No. 312 will be debated this afternoon. This is a classic example of what happens to good-natured Members when deprived of the benign influence of the Whips' Offices.
I understand the importance that the right hon. Gentleman attaches to the aerospace industry, the nationwide employment consequences that flow from its success or failure and, more particularly, the proposed A320 airbus project. As he will know, the proposition for launch aid is now before my right hon. Friend the Secretary of State for Trade and Industry. I suggest that, through the usual channels, we might consider what are the most appropriate parliamentary mechanisms for dealing with that.
I note the vigorous opposition that is promised for the Second Reading of the Rating and Valuation (Amendment) (Scotland) Bill. Although I am flattered to be invited to say what will be contained in legislation for England and Wales which has not yet been published, I think that it would be a departure if I were to respond to the right hon. Gentleman's question.

Several Hon. Members: rose——

Mr. Speaker: Order. There are two important debates on the EC to follow business questions. I propose to allow business questions to continue until half past 4.
I am able to put the mind of the hon. Member for Ogmore (Mr. Powell) at rest. The blue Order Paper containing the early-day motions is available in the Vote Office.

Mr. Ivor Stanbrook: In view of the report earlier this week of threats to the life of Her Majesty the


Queen, is it not becoming urgent to provide her with the legal protection which at present we give only to the homes of foreign diplomats? Is my right hon. Friend aware that last Friday Government Whips blocked the Criminal Law Act 1977 (Amendment) Bill which would have provided that protection for the Queen? Will he undertake tomorrow to ensure that they do not block that Bill again, as it has the support of hon. Members on both sides of the House? Why deprive the Queen of the protection that we give at present only to foreigners?

Mr. Biffen: My hon. Friend's plea will have been heard by my influential neighbour.

Mr. Greville Janner: In the wake of the recent Woolworths case, will the right hon. Gentleman give time to debate the need for a change in the laws on shoplifting and private prosecutions, as is now sought not only by campaigners in the House but by the chairman of Woolworths himself? Meanwhile, will the right hon. Gentleman warn shoppers to take great care during the Christmas season, because of the enormous danger of innocent people being wrongly charged with this offence?

Mr. Biffen: I have a sufficient respect for the hon. and learned Gentleman to know that this exchange will already have been alerted to many in the press, and properly so. On the hon. and learned Gentleman's first point, I think the topic would be eminently suitable for one of the Adjournment debates.

Sir Hugh Fraser: With regard to the missing numbers, may I congratulate the right hon. Member for Islwyn (Mr. Kinnock) on taking over my motion? I have always thought that the Opposition needed a leader. I congratulate the Whips on the organisation of the spontaneous changes of mind. They have quite a lot to teach the shop stewards of the National Graphical Association.

Mr. Biffen: There is nothing that I can add to that.

Mr. A. E. P. Duffy: Has the Leader of the House noticed the announcement last Friday of the impending closure of Hadfields in my constituency? Is the right hon. Gentleman aware that the firm's name became a byword for excellence in steel making, that it provided Britain with its smithy in two world wars, that even now, after incredible difficulties, it is still in the black—and has, incidentally, stayed private—but that it is to be killed by the Government's phoenix 2 project? Does he not think that it deserves at least the attention of the House before it is snuffed out?

Mr. Biffen: The hon. Gentleman raises a point not only of great industrial significance but of constituency concern for himself and for the city of Sheffield. It is a topic that might well feature in an Adjournment debate.

Mr. Barry Porter: Will my right hon. Friend find time as early as possible to debate two important matters? I follow on from what the hon. Member for Sheffield, Attercliffe (Mr. Duffy) said about redundancies. My right hon. Friend will be aware of the tragic news of major redundancies in one of our great national organisations, which has, I am afraid, been subject in the past, and is subject now, to incompetent management. Will he arrange for an early debate to try to

sort out, in a process of conciliation rather than confrontation, the redundancies at Walworth road, the Labour party headquarters?

Mr. Biffen: I feel so overstretched at this very moment that I do not wish to add to my responsibilities.

Mr. Max Madden: Will the Leader of the House seek urgent discussions with the Home Secretary about the planned 24-hour picket by the Anti-Apartheid Movement outside the South African embassy from tomorrow evening in protest at the continued imprisonment of Nelson Mandela? I understand that the chief police officer at Cannon row police station has refused permission to picket outside the embassy and is insisting that it takes place on a narrow pavement in Duncannon street. The Anti-Apartheid Movement is fearful of the consequences if more than the 200 pickets whom it expects to attend are compelled to picket on the narrow pavement. Will the Leader of the House ensure that this is a peaceful picket by allowing the Anti-Apartheid Movement to picket outside the South African embassy as it has done peaceably on many previous occasions?

Mr. Biffen: I shall certainly represent to my right hon. and learned Friend the Home Secretary the anxieties that have been mentioned by the hon. Gentleman.

Mr. Geoffrey Finsberg: Now that the civil defence regulations have come into force, will my right hon. Friend ask my right hon. and learned Friend the Home Secretary to make a statement next week giving the results of his consultations, particularly with the so-called nuclear free zone authorities?

Mr. Biffen: I give that undertaking.

Mr. Norman Atkinson: Did the Leader of the House hear the Prime Minister say, in the presence of the Foreign Secretary, that it was impossible to bring Greece and Turkey together to discuss Cyprus? In view of the imminent accession of Mr. Ozal to the leadership in Turkey, does the Leader of the House agree that it is essential that the House should find time to debate the 1960 treaty on Cyprus, the coming together of Greece and Turkey, and all those issues that have been raised by the declaration of independence by Mr. Denktash?

Mr. Biffen: No provision is made in next week's business for a general foreign affairs debate or one specific to the points that have been raised by the hon. Gentleman, but I shall certainly draw the attention of my right hon. and learned Friend the Foreign Secretary to the points that he raises.

Mr. Peter Bottomley: Will my right hon. Friend say whether it is the pressure of Government business that has kept a Supply day out of next week's business? As the Warrington picketing issue seems to have taken up so much of Prime Minister's Question Time and been the subject of private notice questions during the past week, would it not be useful to have a full debate on the Floor of the House so that the Leader of the Opposition can make absolutely plain his views on the different issues involved, rather than just sliding out a statement late at night and not answering the question that my right hon. Friend the Prime Minister put to him today?

Mr. Biffen: That is a fascinating line of reasoning, but I think that it would be much wiser if I said that next week's business gives full importance and priority to the Government's crowded legislative programme.

Mr. Michael Meadowcroft: As the right hon. Gentleman's optimism last Thursday about the appointment of Select Committees went unrewarded, will he tell us what steps he intends to take this week to resolve the problem?

Mr. Biffen: I am grateful to the hon. Gentleman for raising the matter. I know that hon. Members on both sides of the House are anxious to see the Select Committees being set up. However, the motions in the name of my hon. Friend the Member for Gedling (Sir P. Holland) have been objected to in the House on two occasions. I understand that efforts are being made to see whether proposals that are acceptable to both sides of the House can be found, and I think that it is in the interests of the House to allow these efforts to continue. I very much hope however that it will be possible for me to make a positive statement on this matter in my next business statement.

Mr. Andrew MacKay: Notwithstanding last week's welcome announcement by my right hon. Friend the Secretary of State for the Environment that he intends to withdraw his draft circular on the green belt, is my right hon. Friend aware that other aspects of planning and development are giving rise to great concern in all parts of the House? Will he reconsider my previous requests for a debate in Government time on this importat subject before the House rises for the Christmas recess?

Mr. Biffen: I very much admire the persistence with which my hon. Friend pursues this case. If all else fails—I can certainly offer no Government time over the next week — he might be moved to suggest that we should not adjourn for the Christmas recess before we have debated this subject.

Mr. Ted Leadbitter: The Leader of the House will be aware of the recent statement on the disposal of radioactive nuclear waste material. The House has not had an opportunity to debate this highly sensitive subject. As NIREX has come forward with proposals about which there is considerable public concern, will he take account of the need to have an early debate on this subject which is of interest to the whole country?

Mr. Biffen: The hon. Gentleman raises a fair point. This is a matter of widespread public concern. A report is being undertaken and, as I understand it, will be made available by my right hon. Friend the Secretary of State for the Environment. Perhaps we can see what would be appropriate action in the light of that report.

Mr. James Lamond: This afternoon the Prime Minister announced, surprisingly, a new policy of sweetness and light between East and West. Will the Leader of the House remind the Foreign Secretary that in January there will be a conference in Stockholm of the 35 nations involved in the Helsinki final act, at which disarmament and co-operation are to be discussed? Will there be a statement about the proposals which the Government intend to put forward as a result of the Prime Minister's change of policy?

Mr. Biffen: I note the hon. Gentleman's request. He will appreciate that next Wednesday the Foreign and

Commonwealth Office is due to answer questions. Perhaps the House should see what information is revealed then, before asking for a statement on this matter.

Mr. David Winnick: If there is to be another statement on the Warrington dispute next week, is it not right to remind Liberals and SDP Members who are trying to be as like the Tories as possible on this issue, that Mrs. Shirley Williams, honourably and rightly in person at Grunwick, supported the right of working people to belong to a trade union?

Mr. Biffen: It is not the right to be a trade unionist that is in dispute. I do not wish to intercede for the hon. Gentleman or to perform a personal advisory, conciliation and arbitration service between him and the alliance, but while the dispute continues there is likely to be a large recruiting surge from the Labour party to the alliance.

Members of Parliament (Constituency Matters)

Mr. Greville Janner: On a point of order, Mr. Speaker. I have given you notice of my point of order, which arises from my question on Monday about the Government's delay in opening the pit at Asfordby, in the Vale of Belvoir, and its effect on the employment of miners, many of whom are my constituents. The hon. Member for Leicestershire, North-West (Mr. Ashby), clearly and not for the first time, criticised my involvement in the matter on the basis that it was improper to raise matters about the employment of people outside one's own constituency.
On Monday the hon. Gentleman implied that I was misleading the House in saying that there were miners living in my constituency and that he was not aware that there were any. The headquarters of the National Union of Mineworkers and of the National Association of Colliery Overmen, Deputies and Shotfirers in Leicestershire are in his constituency, and had he taken the trouble to make inquiries from them, which he did not, he would have found that there are hundreds of miners living in my constituency. Whether he sees fit to apologise is a matter for him but will you, Mr. Speaker, tell me whether it is right for hon. Members to raise matters that affect the employment of their constituents — people whom they care for and represent—although that employment may not be in their constituencies'?

Mr. David Ashby: If the hon. and learned Gentleman says that there are miners in Ins constituency, of course, I believe him—although I am surprised that those miners see fit to travel so far to work. However, that is not the point at issue. Since most of the coalfields and almost all of the pits that are being closed are in my constituency, it is unfortunate that he did not notify me of his intention to raise this difficult and sensitive subject. I regret that he asked the question without discussing it first with those most closely involved, and believe that he is the one who should apologise.

Mr. Dennis Skinner: Further to that point of order, Mr. Speaker. The Tory Government think it right and proper to carry out a policy of mass unemployment, which causes distress in all constituencies. If it is right for Tory Members to render people unemployed in


constituencies other than their own, what is wrong with my hon. and learned Friend the Member for Leicester, West (Mr. Janner) or another hon. Member trying to secure employment for his constituents and people elsewhere?

Mr. Speaker: For the benefit of new Members, I should confirm that there is nothing contrary to the rules of the House in an hon. Member asking questions about, or otherwise pursuing matters concerning, the constituencies of other hon. Members. It often happens where matters of wide public interest are at issue, but it is courteous to inform the hon. Member representing the constituency concerned. As nothing during today's exchanges requires a response from the Chair, I cannot intervene.

Town and Country Planning Bill

Mr. Simon Hughes: On a point of order, Mr. Speaker. Will you look into the fact that the Town and Country Planning Bill, which we understand will be debated next Wednesday, was unavailable at the beginning of business questions this afternoon, and that, therefore, there will be only four clear days between its availability, if it is available later today, and its coming to the Floor of the House? I understand that the convention in the House is to allow at least two weekends for a Bill to be considered by all interested parties before it is debated.

The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): Although the Bill will be available later this afternoon, it is true that there will not be two weekends before it is debated. Although that has been the convention, it is not an iron rule.

BILLS PRESENTED

LONDON REGIONAL TRANSPORT

Mr. Secretary Ridley, supported by Mr. Secretary Brittan, Mr. Secretary Jenkin, Mr. Secretary Tebbit, Mr. Secretary King, Mr. Peter Rees and Mrs. Lynda Chalker, presented a Bill to make provision with respect to transport in and around Greater London and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 68.]

TOWN AND COUNTRY PLANNING

Mr. Secretary Jenkin, supported by Mr. Secretary Heseltine, Mr. Secretary Younger, Mr. Secretary Edwards, Mr. Secretary Fowler, Mr. Attorney-General and Mr. Neil Macfarlane, presented a Bill to make further provision with respect to the application to Crown land of the enactments relating to town and country planning; and to enable persons in occupation of land by virtue of a licence in writing to appeal against certain enforcement notices issued under those enactments: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 67.]

European Community (Budget)

The following document is also relevant: No. 9825/83, Amendments by the European Parliament to the draft supplementary and amending budget No. 2 for 1983.

Mr. Speaker: Before we move on to the important debates on the European Community, I should inform the House that many right hon. and hon. Members wish to speak. This is a day when, in the interests of all hon. Members, short speeches would be of great benefit.

The Secretary of State for Foreign and Commonwealth Affairs (Sir Geoffrey Howe): I beg to move,
That this House takes note of European Community documents Nos. 6863/83 on future financing of the Community, 8822/83 on the Community structural funds, 5500/83 and 8552/83 on the supplementary measures scheme, 8385/83 the preliminary draft supplementary and amending budget No. 2 for 1983, the subsequent draft supplementary and amending budget No. 2 for 1983, the letter of amendment to the draft supplementary and amending budget No. 2 for 1983, and the Report by the Court of Auditors on financial management of Community activities (Official Journal C 287).
This is the first of two short debates on documents relevant to the current negotiations on the European Community's future financing and development. The other documents covered by this debate relate, first, to the so-called supplementary measures which cover the final refunds on the United Kingdom's contribution to the 1981 and 1982 Community budgets; and, secondly, to the supplementary and amending budget No. 2 for 1983, which was reported to the House by the then Financial Secretary to the Treasury on 25 July this year.
I shall leave the details of the agricultural negotiations to the next debate and try to confine myself to the main issues.
This debate takes place against the background of two important changes. The first is the changing attitude of the Labour party. This is the first time for several years that the House has debated the European Community on the basis of increasing agreement between the parties that Britain's future lies in Europe and that talk of withdrawal is a damaging diversion. We all welcome the fact that, even within the Labour party, there is now grudging acceptance of the view that the European policy on which the Conservative party fought and won the last two elections is correct. All seem increasingly to agree that the Community offers real potential advantages, from Scotland to Sicily, from Kohl to Kinnock, and possibly even from Mitterrand to Marlow. If the evolution of Labour policy is more limited than I have suggested, no doubt the hon. Member for Livingston (Mr. Cook) will make that clear during the debate. The House will look forward to a clear statement from him of Labour's policy towards the Community.
The second important background feature to the debate is that there is now widespread agreement throughout the Community of the need for fundamental changes, broadly along the lines for which we have been arguing for several years. There is agreement that the Community's budgetary arrangements must be reformed, that Community spending must be brought under control, that the budget burden must be shared more fairly and rationally, and that it is especially important to bring the common agricultural policy under control.
There is also agreement that we must develop policies that will enable our industry to meet increasingly tough competition from the rest of the world and, above all, to develop policies that will make a reality of what is not yet a common market.
There is agreement that the Community must be enlarged to include Spain and Portugal to broaden and strengthen the basis of democracy in Europe. Economies must be made in existing policies. Even so, it may be necessary to consider an increase in the funds put at the Community's disposal—own resources.
We recognise the importance of new policies and enlargement. In these negotiations we want to make solid progress on the development of Community policies. That is why the Government put forward clear and specific proposals, which were published in the economic progress report in October. The difficulty is to explain not the case for these ideas, but why they were not agreed long ago.
A great deal remains to be done to establish a genuine common market in goods and services. We need a more liberal transport policy, especially for lorries and air services. We must do more to simplify frontier controls, to remove non-tariff barriers and to establish an effective Community policy for coal. We have put forward specific proposals along those lines throughout the negotiations, and we believe that they will make a practical contribution to the economic development of the Community.
Another benefit will be co-operation within the Community by Governments and companies in areas of modern technology where development on a European scale obviously makes sense. The Esprit programme for information technology is a good example.
Enlargement of the Community is important for different reasons. The accession of Spain and Portugal will strengthen democracy in Europe——

Mr. Teddy Taylor: How?

Sir Geoffrey Howe: —and add political and economic weight to the Community as a whole. They will add important components of democracy to the European Community.

Mr. Teddy Taylor: How?

Sir Geoffrey Howe: Those countries have recently moved to a democratic system of government. Their chances of retaining that system of government will be strengthened by membership of the Community.

Mr. Teddy Taylor: How?

Sir Geoffrey Howe: I have answered my hon. Friend's repeated question at least three times. We remain firmly committed to the enlargement of the Community for the reasons that I have given.

Mr. Nicholas Budgen: Will my right hon. and learned Friend give way?

Sir Geoffrey Howe: I shall not give way, because this is to be a short debate. I shall make my speech as short as I can, without interruption.
Negotiations for enlargement should be completed urgently.
Some Community policies — though not by any means all of them—are bound to cost money, as will enlargement. That has led some of my hon. Friends and others to argue that the resources of the Community should be increased forthwith by raising the financial ceiling under which the Community operates.
We have made it clear that we do not accept that case. At the very least, it would put the cart before the horse. Heads of Government agreed at Stuttgart that a decision on future financial requirements could not be taken until the outcome of the many other aspects of the present negotiations was clear.
I know that some hon. Members still feel that the case for lifting the financial ceiling will even then he very difficult, if not impossible, to establish. I agree with those who argue that Community expenditure has not so far been subject to the same strict controls as national expenditure, and that, if it had been, there would still be room below the present ceiling. We have not said — as the Opposition amendment seeks to argue — that we will never even consider an increase in the Community's resources. We have said that, if that is to be considered, it can only be when certain very firm conditions are fulfilled.
Those conditions were stated very plainly by my right hon. Friend the Prime Minister at Stuttgart. My right hon. Friend made it clear we would be prepared to consider art increase in own resources provided we reached agreement on an effective control of agricultural and other expenditure and provided it was accompanied by an arrangement to ensure a fair sharing of the financial burden, so that no country had to pay a share disproportionate to its relative national wealth.
We have stood firmly by these conditions in the negotiations, and we shall do the same at Athens. We have had some useful support from other Governments, particularly the Dutch and German. This underlines the point that our conditions are not an expression of British selfishness. They are no more than is necessary for the future well-being of the whole Community.
That is the justification for our two conditions. The negotations have focused on the detail of how they should be met.

Mr. Robin Cook: Before the Foreign Secretary leaves the issue of own resources, will he respond to the surprise that was recorded by the Scrutiny Committee that the Economic Secretary was unable to inform the Committee about the form in which an increase in own resources would come before the House? Will it come before the House in the form of a Bill? Will there be a Division at 10 o'clock? Will it, as is normal with treaties, be laid on the Table and be subject to the negative procedure? There would be considerable concern in the House if proper and adequate facilities were not made available for hon. Members to reach such an important decision.

Sir Geoffrey Howe: I understand the importance that the hon. Member for Livingston attaches to such a decision. That is one of the features that I have stressed throughout the negotiations. A decision to increase own resources would require ratification by the Parliaments of all the member states. This Parliament specifically would require an affirmative resolution to be considered in both House of Parliament. There can be no doubt about the need for separate national ratification of this decision and its important part in the argument.
Inevitably, the emphasis has been on controlling agricultural spending which now accounts for about 65 per cent. of Community expenditure. That expenditure has risen this year by 30 per cent. The problem has long been


recognised, and numerous attempts have been made to deal with it. The House may remember that in 1979 the then Labour Foreign Secretary—now the leader of the Social Democratic party — said that reform of the common agricultural policy was one of the successes of the Labour Government. That was a false dawn, because nothing could have been further from the truth. That is why we are insisting on the need to design and apply a binding financial framework for the CAP. It is, of course, not only in agriculture that expenditure needs controlling. Our proposal for a financial guideline for agriculture has stimulated thought elsewhere in the Community on the overall control of Community spending. That is the importance of the French Government's suggestion, spelt out this week, that each year, before detailed discussion of the budget begins, overall spending limits should be agreed. We find this idea interesting. So long as it is combined with effective action to contain agricultural expenditure—that must be stressed—we should like to see it developed further.
On our second condition—budgetary reform—there has been a sea change in thinking in the Community. This becomes apparent if one looks back to the starting point. The United Kingdom has been a below-average recipient of Community expenditure. We have been called upon to contribute to Community spending at a rate above our proportion of the Community's wealth.
The Labour Government tried to deal with the problem in 1975 by negotiating a financial mechanism. The conditions they accepted were totally useless, because that financial mechanism failed to bring us one penny piece by way of compensation.
We made it clear from the start that we were determined to remove the unfair burden on Britain. We reached agreement in 1980 on refunds covering three years, and we subsequently negotiated further refunds covering 1983. The total refunds secured over the four years amount to two thirds of our unadjusted net contribution.
The process of negotiating these refunds was not agreeable, but it was necessary in those circumstances. The negotiations at Stuttgart and in the Special Councils have now moved the debate on to firmer ground. We are very close to agreement on four major issues.
The first is that the serious problem of budgetary imbalance in the Community must be solved on a lasting basis, without the need for the annual haggling which has taken so much time and energy over the last few years. For that purpose we need an arrangement which will work as well for the enlarged Community as for the present one.
The second issue on which agreement is close is that the arrangements for limiting the burdens on a member state should reflect ability to pay. Per capita GDP is probably the best measure of this, and a number of proposals—as well as our own—have now adopted this approach.
The third point is that the solution should be implemented on the revenue side of the budget, so that what is overpaid one year can simply be deducted from contributions the next. That leaves the expenditure side of the budget free to be considered, as it should be, on the merits of individual community policies.
The fourth point is that the new system should apply in respect of 1984 as well as subsequent years so that there will be no need to negotiate separate special budget arrangements.
The main point that remains to be decided is the measure of the burden to be corrected and how much of that burden should be corrected. The argument is a mixture of what can only be described as Community theology and hard calculation on numbers. Our argument has been and remains that the problem can be measured only as the gap between our contribution to the Community's finances and the Community's actual expenditure in the United Kingdom. That is the true size of the burden. It is in that context that our safety net proposal has been put forward as the most appropriate solution. Others have put forward a wide spectrum of alternatives, many of which commend themselves to their authors and supporters, principally because they purport to reduce the scale of the problem.
That need not, of course, be true of all alternatives which may be proposed. We have made it clear that we shall look at other approaches so long as they fairly address the problem as a whole and do not try to treat it as though with one of those shrinking mirrors that one finds at Madame Tussaud's. As to the level of correction, we have made it clear throughout that we are prepared to remain a modest net contributor, but only on a scale in keeping with our relative prosperity in the Community.
If agreement can be reached on the two points on which I have laid such stress, we shall have to think very carefully about the Community's future financial requirements, as we agreed to do at Stuttgart. We shall need to weigh up carefully, first, the justifiable claims on the Community of two relatively poor contries, Spain and Portugal; secondly, the possiblity of some expansion of Community spending where action at Community level can be clearly shown to be more effective than action at national level; and, thirdly, the cost of putting right our own and any other country's excessive budget burden, which may require funding from the total budget.

Mr. David Heathcoat-Amory: My right hon. and learned Friend referred to various expenditure reforms, especially in agriculture, which he believes are necessary and will take place. Surely, if those reforms are implemented, it will not be necessary to increase the size of the Community budget. The reforms are being contemplated only because the Community is now running out of money. Therefore, if we agree to an increase in own resources, we shall relieve the pressure and expenditure will rise to the new higher level.
What is so different about European Community expenditure? Why should it be exempt from the disciplines of which my right and learned Friend was so effective a proponent when he was Chancellor of the Exchequer?

Sir Geoffrey Howe: I am grateful to my hon. Friend for drawing attention to the last point. One of the arguments at the heart of our case in the Community is based on a remark that I made in my 1979 Budget speech, when I said:
Finance must determine expenditure, not expenditure finance."—[Official Report, 12 June 1979; Vol. 968, c. 246.]
The extent to which the case has advanced is illustrated by the fact that that was reproduced verbatim in the French proposals of Monday night.

Mr. Heathcoat-Amory: Then why has my right hon. and learned Friend changed his view?

Sir Geoffrey Howe: I accept that it is because of the constraints imposed by the fact that the Community is running out of money that the argument has been coming through. That is one of the factors that enables and obliges not just the British Government but all Community Governments to take steps to secure more effective control.
The crisis is the opportunity. That is why we are seeking to control the rate of growth of agricultural expenditure. Those of my hon. Friends who are critical should remember that Community agricultural expenditure is not solely to the advantage of other countries and of no interest to our farmers. The task of controlling and regulating agricultural support policies is one of profound difficulty throughout the world. It is crucial that we take this opportunity to improve the Community's mechanism. However, even when that has been done, and even if we manage to check the growing subsidies on both sides of the Atlantic, it is highly optimistic to believe that we shall be able to finance programmes which could be more effectively pursued at Community than at national level and to provide the resources to correct our own and many other member states' excessive budget burdens.
The House must understand that, even if there is an increase in the level of own resources provided for by the Community as a whole, if that is accompanied by an effective financial mechanism, the effect will be substantially and reliably to reduce the net cost to the people of this country, and enable us to secure that which my hon. Friends seem to want—effective control of the net contribution made by this country. If that key objective is achieved, we must consider whether the case for an increase in own resources has been made. We shall weigh up all that in good faith to determine whether it justifies an increase in the present ceiling and, if so, how much, but we shall maintain, as we have always done, that the burden of proof is on those who argue that the present ceiling must be raised.
In this connection I welcome the amendment in the name of my hon. Friend the Member for Hampstead and Highgate (Mr. Finsberg), and I am pleased to see that it has received the support of many other Conservative Members. My hon. Friend is right to insist on the conditions that the Government have laid down, and I am delighted that such a rapid accession of good sense has followed. It is in no way a conversion but a recognition of the important validity of the conditions that we laid down from the outset to ensure that, even in the event of an increase in own resources, the net cost to the United Kingdom would be reliably reduced.
Although it will not be possible to vote on my hon. Friend's amendment, it is on that basis that I ask the House to vote against the negative amendment tabled by the Opposition and for the motion in the names of my right hon. Friend the Prime Minister, myself and others of my right hon. Friends.

Mr. Robin Cook: I beg to move, at the end of the Question to add
`and believes that the own resources of the European Community should not be increased.'
The amendment gives the House an unusual, pleasing and all-too-rare opportunity to debate an early-day motion. An early-day motion in identical terms was tabled yesterday and signed by 121 Conservative Members. It

appeared to us to be an important expression of opinion by a substantial body of Members. It should not be left to languish in the back pages of the Order Paper, but should be ventilated in the Chamber where those hon. Members who put their signatures to the document yesterday will have the opportunity to put their voices to it today.
However, if yesterday's Order Paper was fascinating, today's is rivetting. The hon. Member for Hampstead and Highgate (Mr. Finsberg) was one of six hon. Members who sponsored yesterday's early-day motion. Hereafter I shall refer to him as the hon. Member for Damascus, because yesterday, he had a revelation. On the way to the House a shaft of light descended on him and he perceived that his early-day motion was in grave error. Today, the hon. Member for Damascus heads an amendment to the motion which yesterday he sponsored. Even more remarkable is that the personal revelation that was vouchsafed to the hon. Member for Damascus spontaneously occurred to no fewer than 68 of his hon. Friends. It has been the most extraordinary case of mass conversion since St. Augustine came ashore at Kent. There was not even a general election between yesterday and today to explain why those hon. Members should have changed their minds.

Mr. Robin Maxwell-Hyslop: Among the very remarkable incidents is the fact that the Table Office accepted the amendment, since one cannot amend one's own motion.

Mr. Cook: The technical answer is that the hon. Member for Hampstead and Highgate withdrew his name from the motion. That does not answer the question how he came to be facing in both directions in such a short time. The House would not be expected to believe that such a mass conversion was the product of individual contemplation by each of those 68 hon. Members. When yesterday's Order Paper reached the highest authority in the land an explosion occurred, the shock-waves of which were felt yesterday everywhere throughout the building when the hon. Member for Watford (Mr. Garel-Jones) and his confederates were trying to lay their hands on one of their Back Benchers.
It was impossible at one stage yesterday for hon. Members to enter the Library and go about their business because the hon. Member for Watford was conducting impromptu seminars on the correct Government line on own resources. I was not privileged to be present at such seminars, but the story as reported to me was that those hon. Members who had signed the early-day motion had been misled as to the Government's current position on own resources. I shall not comment on whether the diligent Conservative Members who assembled the early-day motion would have misled their colleagues.
I draw the attention of the House to the fact that the Government's position on own resources is so opaque that nearly half of the Conservative Back Benchers cannot figure out what it is without the aid of a Whip. One can forgive them their confusion. The Government's position on own resources has undergone a rapid change in the past year. We may not have discovered the dynamic effects on our economy since entering the EEC, but we have discovered a dynamic effect on the Government's position as to own resources.
The Foreign Secretary said, if I heard him correctly, that at no time has he ruled out an increase in own


resources. The right hon. and learned Gentleman may reflect that when he was Chancellor of the Exchequer, and I was one of his shadows, a debate took place in February on the 1983 European Community budget. During the opening of the debate the then Financial Secretary to the Treasury, the present Secretary of State for Transport, said:
No one has yet demonstrated that an increase in own resources is necessary.
The hon. Member for Wells (Mr. Heathcoat-Amory) will be interested to hear the words of the then Financial Secretary, when he said:
If agricultural expenditure is properly controlled, the Community's existing revenues should provide the necessary financial resources for the development of the Community policies and, indeed, for enlargement.

If the House was left in any doubt about the Government's position, the hon. Member for Edinburgh, Pentlands (Mr. Rifkind) said:
The Government have not changed their view.
As the hon. Gentleman was speaking a full five hours, he was wise to make that statement later.
No argument can be put forward with any conviction that it is necessary or desirable to increase the own resources of the Community."—[Official Report, 21 February 1983; Vol. 31, c. 670–744.]
I understand why the 121 Conservative hon. Members thought that they were positively supporting that position of the Government. I can understand their being aggrieved at being taken aside by the hon. Member for Watford and cuffed about the ears for lending support to such a positon. The truth is that the Government's position has changed.
I understand from his speech today that the Foreign Secretary believes that there may possibly be a case for increasing own resurces. I shall not go so far as to say that the right hon. Gentleman advanced the belief "with any conviction", to quote the words of the hon. Member for Edinburgh, Pentlands, but he appeared to be advancing a case for an increase in own resources.
The Government have dug a trap for themselves. At Stuttgart, in the summer, they allowed themselves to be backed into a position in which an equivalence was established between the increase in own resources and a solution to the budgetary and agricultural expenditure problems. From then on we were expected by our partners to make a concession on own resources in return for a decent deal on the budget and a sensible approach to agricultural expenditure.
Nothing has happened since February to change the merits of the case or to alter the argument advanced with such vigour by the hon. Member for Edinburgh, Pentlands and by the then Financial Secretary to the Treasury. The documents before the House confirm the case against any increase in own resources.
Commission document No. 6863, which refers to the future financing of the Community, sets out the own resources which the Commission has it in mind to impose. That should be a matter of grave concern to all hon. Members. Paragraph 15 of the document proposes a tax on the domestic consumption of energy. Such a tax would be designed to penalise northern countries to the advantage of southern countries. As Britain is almost the most northerly country in the European Community, the tax would bear disproportionately heavily on us.
I understand that the proposal is unacceptable to the Government. I assure the Foreign Secretary that in

rejecting the proposal he will have the full support of the Opposition. One of the reasons why we will give him our full support in rejecting a European tax on domestic energy is that it would be imposed on top of an already iniquitous British tax on domestic energy which leaves gas more expensive than is necessary for every consumer from ICI to every state pensioner. We applaud the recognition that apparently exists in the Foreign Office that such a tax could not in addition withstand a European tax placed upon it, but we hope that it will make available the negotiating brief to the Chancellor so that he can reconsider the domestic as well as the European tax on energy.
The main burden of an own resources increase will come from an increase in VAT from 1 to 1·4 per cent. I wish to dispel a common delusion. I am grateful to the Scrutiny Committee for setting out the figures so clearly. At present Britian does not merely contribute 1 percentage point of VAT to the Community, but the 1 percentage point is levied on a notional harmonised VAT base. As the EC assumes that VAT is applied to goods to which not even this Government have dared apply it, there is a tax take from Britain well in excess of 1 percentage point of VAT. It currently stands at 1·7 percentage points. If a notional increase to 1·4 per cent. occurred, we would be handling to the EC a full 2 percentage points of the VAT, which is equivalent to more than one seventh of our total VAT take.
The document makes a further suggestion, which I regard as bordering on impertinence. On top of the first increase to 1·4 per cent. of VAT, further tranches should be made of 0·4 per cent. VAT, which could be levied without reference to the national Parliaments of the EC by a three quarters majority of the European Assembly. There can be no question—the Foreign Secretary must be in no doubt about this matter—of this Chamber giving up its sole right to approve taxation levied in Britain. The right to control supply was a right fought for by our predecessors, a struggle in which not a few of them died. Such a right is the precious heritage of each and every hon. Member. It is not for inclusion in a package of bargaining measures in Brussels, and is not to be bargained away in return for a super levy on dairy products.
Nothing in the Commission's document tackles the fundamental problem of the structural defects in the system that leave Britain trapped as a persistent net contributor to the budget. It proposes a modulation of VAT, but it would be in such a low key that it would still leave Britain the second largest net contributor, although the seventh poorest member state. Even more remarkable, if enlargement takes place it would still leave Portugal, one of the poorest nations in Europe, as a net contributor to the EC budget. That is a grotesque outcome.
I am pleased to see the hon. Member for Inverness, Nairn and Lochaber (Mr. Johnston) in his place, as I understand that we are to be treated to a speech from him later. On 14 November, during the report by the Foreign Secretary on the Foreign Council meeting, the hon. Member for Inverness, Nairn and Lochaber raised doubts that the Government's position on budgetary contributions might impede the objective of the EC in obtaining the economic convergence of the economies of the member states. I find it a remarkable tribute to the blindness of alliance Members in their infatuation with Europe — [HON. MEMBERS: "Where are they?"] The hon. Member for Inverness, Nairn and Lochaber is a fair representative


of them all. We can quite happily settle for him. They are so blinded by their infatuation for Europe that during the whole 10 years of debate on the British budgetary contribution they have missed the entire point, which is that the budgetary system, far from promoting convergence of the economies of the EC, actually promotes their divergence by obliging the poor to subsidise the rich.
If alliance Members turn up in greater numbers we shall be interested to see what they do at the conclusion of the debate. Will their infatuation lead them to vote in favour of an increase in the ceiling of own resources so that the poor nations may subsidise the rich nations to an even greater extent?
Nothing in the documents that relate to revenue justifies a change in the Government's position on own resources. Does anything relating to expenditure justify such a change? The documents, far from justifying a change, confirm the correctness of the Government's position last February.
The very next document is a report by the Court of Auditors. Its preface contains the strongest possible case against an increase in own resources. It states:
It was only when the risk of reaching the limit of 1 per cent. VAT own resources became a reality that public attention was focused on the possibilities of making Community expenditure more effective.
If the limit has obliged the EC to have regard to the effectiveness of its expenditure, what possible incentive could there he for us now to raise and remove that limit?
I do not wish to trench on the issues of the next debate, but it is impossible to have regard to expenditure without making some mention of the CAP, which swallows two thirds of expenditure—10 times the sum going to the regional or social funds, and the sole source of this year's budget crisis because of the staggering 30 per cent. increase in agricultural expenditure this year.
The picture that emerges from the Court of Auditors report is of an incoherent, self-contradictory, inefficient agricultural system, in which the subsidies vary arbitrarily product by product, farmer by farmer and country by country. Britain now has the entirely unforseen development of a cauliflower mountain, as well as our other mountains. Last year the Minister purchased under intervention 8,200 tonnes of cauliflower. I am advised that at Sainsburys today an average cauliflower weighs 700 grams. The statistics department has worked out that that means that last year the Minister consumed and bought under intervention 12 million British cauliflower. It would require Salvador Dali to do justice to the mound of 12 million cauliflower being bought and destroyed under intervention. Cauliflower which the British public either did not want or could not afford were brought into existence simply by the bizarre workings of the agriculture system.
A year ago there was brave talk of the reform of the CAP, but "reform" now appears to be a word that has disappeared from the vocabulary of the debate. I did not hear it used once by the Foreign Secretary during his address. It is not used in the Community document before us. Document No. 8823 refers not to the reform of the CAP, but to its adaptation. The Damascus amendment refers not to the reform of the CAP, but to
arrangements satisfactory to Her Majesty's Government".
Nobody is talking about a change in the structure of the CAP to carry out a root and branch reform of the structural

surpluses. The Government are proposing to settle for a limit on the increase in annual costs of the CAP. There is ample evidence that Ministers do not expect to achieve that. They may be influenced by what The Economist indelicately referred to as "the barn-full of farmers" in the Cabinet.
A fortnight ago the Chancellor came before the House with his autumn statement. It provided for an increase in expenditure under the Ministry of Agriculture, Fisheries and Food. I have before me the statement made by the Minister of Agriculture, Fisheries and Food about next year's expenditure. He said:
This is £437 million higher than previously planned. Of this sum, £422 million provides for additional expenditure by the Intervention Board for Agricultural Produce, mainly in respect of an expected increase in the level of intervention for butter and skimmed milk powder; the remaining £15 million is a net increase in planned expenditure" — [Official Report, 17 November 1983; Vol. 48, c. 557.]
In other words, of the £437 million increase in agricultural expenditure next year, £15 million is for planned expenditure and £422 million—a 50 per cent. increase — is for increased intervention under the CAP. It is plain that neither the Chancellor nor the Minister of Agriculture, Fisheries and Food expects the Foreign Secretary to succeed in obtaining tight controls on the CAP. Possibly, and more sinisterly, the Cabinet does not expect the Foreign Secretary and the Prime Minister seriously to try to succeed if it damages the interests of the farmers.
Whether we look at the documents that deal with revenue or those that deal with expenditure, there are no grounds for the Government shifting from the position that they took on own resources last February. Nor is Athens the time to abandon that position. Athens finds the Community in crisis and obliged by the ceiling on its expenditure to confront the contradictions in its policy. It provides a window of opportunity for Britain. It is the best moment to oblige the Community to face the changes that it needs to make. It is the very last moment to raise the ceiling to enable the Community to escape from facing the changes; to enable it to continue to squander expenditure on its absurd agricultural policy and to extort more revenue from the British to pay for it.
This is the last opportunity for the House to voice its opinion before Athens. I urge the House not to let this opportunity slip from its grasp, but to sieze it and use this debate to make an unequivocal declaration that neither in present circumstances nor in immediately forseeable circumstances will this House accept an increase in the own resources of the EC.

Sir Hugh Fraser: I can but congratulate the hon. Member for Livingston (Mr. Cook), who has spoken almost to my motion. Mine is the voice of Jacob while he has the hairy hand of Esau which is trying to destroy the Government.
What I propose is intended to support the Government and strengthen their hand. They are entering difficult negotiations. On the trip to Athens, I regard my right hon. Friend the Prime Minister as a maid of Athens who is accompanied by that Byronic figure the Foreign Secretary. They need ammunition if they are to engage in another battle of Navarino to force changes. By not accepting my motion they have thrown away nearly all the ammunition that they could have had. That is a great error by the


Foreign Secretary. He and the Prime Minister are walking naked on to the lido in Athens. It would be much better if they went prepared to fight theirs and Britain's corner.
I promise not to detain the House long, but there are a few points which stand out. There is the question of the 66 missing Members. Those hon. Members have been led astray by one whom I would not call the hon. Member for Damascus. He is like one of those whom we see in a south American frigenficos or meat plant—a Judas sheep who leads the flock up the ramp and jumps aside to watch them fall to their deaths in a hideous tangle of massacring machinery.
There is a missing chain or link in the Government's policy. Why is there now a difference between their policy and the bold statement made in February by my right hon. Friend the Secretary of State for Transport, then the Financial Secretary to the Treasury, that there would be no more release of resources? I believe that the answer is that, by now, the Government have seen the figures and recognised that they were running into extra expenditure for this year of about £1·4 billion. Seeing that in the supplementary budget, they panicked. We should project the results of that bad budgeting into next year. We should consider the growth in America. The whole of Kansas has now been released for grain growing this winter.
We should examine what is happening in the European farming community. There are now 25 million European cattle that need £2 billion of farm support. Many are the cattle of peasants. Those who have been to Europe will have seen what happens to some of those cows. They are stuffed with food rather like geese being prepared for pate de foie gras. The milk yield is increasing, but those cows scarcely ever see green grass. They are part of a cow factory that produces 3,000 gallons of milk per lactation as opposed to the 1,600 gallons produced by the cattle that live on our good green British fields. Since February the Government have seen a budget running hopelessly out of control.
The Government should take an infinitely tougher line at these negotiations. It is now too late to fiddle about with the nuts and bolts. We have heard of the need to relaunch the EC. Let it be relaunched, but let it also be a ship that is seaworthy and able to meet some of the troubles that lie ahead. That involves a more profound examination of what my right hon. and learned Friend has proposed today.
The hon. Member for Livingston pointed to the profound economic, political and historic costs involved if the House permits future budgeting to be controlled not by the House but by a group of Euro-MPs and a Council that meets in Brussels. I assure my right hon. and hon. Friends that there will be strong opposition from both sides of the House to such a development.
Tinkering with the budget is no longer any use. I want the EC to be a success, but it cannot be successful if it continues to waste money at its present rate. The problem is not so much what was identified in the Court of Auditors' report as what is seen by anyone who has anything to do with that organisation. In one of the many policy papers before us, it is stated that such are the difficulties and confusions, it is proposed that the olive oil regime be removed from EC control and returned to national Governments, albeit under EC supervision. We have a model there for effective change. The worst element in the agricultural problem at the moment is the

tide of milk which is no longer being consumed. Europe now produces 20 per cent. more milk than is needed. All that has been advanced so far by officials in Brussels would not staunch that flow. Indeed, it would have an immensely bad effect on British farming. Super-levies, taxation on margarine and taxation of feed for livestock would simply hit our farmers although they are innocent of contributing to the gigantic problem of the colossal surplus.
Under some form of federal control, dairy produce and the dairy regimes should become national responsibilities. My right hon. and learned Friend will find British farmers are so nervous that they might accept that proposal. Indeed, some European farmers and Governments might also accept it. If such a decision were taken, £2 billion would immediately be taken out of the deficit. People in Athens would be given time to think. Now is the time to advance such a policy.
The EC is effectively bankrupt. The Government should come forward with a positive policy for fundamental change. Over the next six months £2·5 million of EC funds will be spent on advertising the importance of the Common Market to the electorate. Let us have a policy that makes that sale worth while.

Mr. J. Enoch Powell: The Foreign Secretary, who seems to have gone home early, associated himself with those who recently, and particularly since the general election, have gone about declaring that Britain's membership of the EC is an issue that is finished, settled and buried. He is mistaken, despite the fact that, on the morrow of their defeat, the then occupants of the Opposition Front Bench, like defeated legions, threw away their eagles in the precipitancy of their flight. He is mistaken even though some 60 or 70 Conservative Members changed their minds on a proposition to which they had put their signatures in an act of personal infamy which they will remember as long as they are Members of Parliament. He is still mistaken for a simple and unquenchable reason. There is an irreconcilable gulf and opposition between membership of the Community and the expansion and development of the Community on the one hand and the sovereignty of the House of Commons on the other.
That is a question that neither the House nor those who create the House, and for whom it exists, will ever allow to be buried until it has been settled again in their favour. The sovereignty of this House is indissolubly bound up with the control of this House over expenditure and taxation. Without that control, we should have been nothing and we shall be nothing. Control over expenditure and taxation is alike removed from this House by the operations of the EC.
I notice that the Scrutiny Committee quoted with approval the alleged intended rejection by Her Majesty's Government of a mechanism that would influence national contribution by extra expenditure. However, even if that mechanism is not adopted, even if the matter were dealt with by the principle of the juste retour about paying in no more than we get back—a principle incompatible with the notions, philosophy and intent of a developing European Community—we should have lost our control over that block of our national revenue and resources. That would be money that was spent not according to the decisions of the House, but according to the decisions of


another body. So, by the nature of its very principles and purposes, the Community exists and depends upon removing the control of this House over an increasing volume of expenditure for which we provide the means.
We come then to revenue. It is overt and flagrant that not only in own resources but in all the other resources of the EC that are withdrawn from the House we have taxation without the will of Parliament. We already have taxation, which consists in a power of taxation once and for all handed over in 1972, but only in the case of own resources up to 1 per cent. That existing limit is to be challenged, and anyone who observes the behaviour of Government knows that they are preparing to give way to that challenge and increase that limit. That limit will be increased and that once and for all cession of an additional block of revenue raised from the British people will be raised by legislation that will not be made by a Bill presented to the House and examined by our normal procedures before it is allowed to find its way to the statute book. It will be as a result of treaty. Taxation by treaty—that is what we have as part of the EC. It is the making of the treaty, a prerogative act, that determines the obligation of the Government and the necessity for this House to levy taxation upon British people.
As a high Tory, I am very protective of the Royal prerogative, but taxation by prerogative is something to which I would never have imagined this Parliament and this House of Commons would submit. It is taxation by prerogative, and another slice of taxation by prerogative, to which we are to be subjected. The Community has given us a glimpse into its thinking by its further proposal. After we have handed over that grant it will be made easier for it after that.

Mr. Hugh Dykes: Good.

Mr. Powell: "Good," says the hon. Member. We should tell his constituents and the people of this country that he is satisfied for this House not to control the taxation that they have to pay, because that is what we are talking about.
After we have made the further grand renunciation of the 1·4 per cent., and the hon. Member for Livingstone (Mr. Cook) has exposed the deceptive nature of that figure, taxation is to be easier for the Community because it is to be done by unanimity in the Council and a three fifths majority of votes in the European Parliament.
It is not without its salutary uses to look back sometimes to see what we were told at each successive stage in our decisions that have brought us here. The fears that were voiced at each stage, the ridicule and the dismissal that greeted them, the reference in that context to the European so-called Parliament, the European assembly, are not without significance, for the Government would not have been in the straits in which they now find themselves, of contemplating surrender upon the own resources limit, but for the fact that the directly elected assembly started, in the past year or two, to use its powers.
Someone said when we debated the direct election of that assembly in 1977:
We should not flatter ourselves that these powers are circumscribed or limited, and that they will remain exactly as they are at present unless and until we and eight other Parliaments decide otherwise. It will not be so. The moment that the right to reject the budget or to dismiss the Commission is in the hands of those who sit in the assembly by the same right as we sit here, it will be found that those are very far-reaching powers indeed. It will be found that the Assembly has become a body which the

Commission will have to obey … and it will be a body which the Council of Ministers will be unable to defy."—[Official Report, 24 November 1977; Vol. 939, c. 1790.]
That was said in 1977, and it was a description of a course of events over the past 18 months that have led the Government into the ignominious position in which they sit today.
This question will not rest, and this conflict will not cease until it has been decided. The Prime Minister returned today from a futile exercise in India and goes shortly to serious business, at which the rights and powers of the House will be at stake, in Athens. The Prime Minister, I believe, knows, and knows by a kind of instinct, the determination of the British people, sometimes hidden, sometimes overridden, and their sense that it is in this House and in the rights of this House and the sovereignty of this House that their ultimate protection and ultimate future lies.
When the right hon. Lady goes to Athens she will have to measure against that knowledge—a knowledge that goes beyond the week, the month or the year—the tactics that she applies to extricate the House, the Government, and her party into the bargain, from a commitment that is inconsistent with that which the British people will never consent to give up. At each stage, as they realise of what they have been deprived, they will more clearly see that they have to withdraw the consent, which was given in their names but not with their will or understanding, to surrender what this House stands for. She will have that in mind when she goes to Athens.

Mr. John Mark Taylor: Mr. Deputy Speaker, I rise for the first time in this House aware of the conventions and anxious to observe them, and aware of the fact that this is a short debate and therefore mean to keep my remarks to a minimum.
It would be wrong of me to start without paying a proper tribute to my predecessor as Member of Parliament for Solihull, Mr. Percy Grieve, QC. He represented Solihull with great distinction for 19 years, was highly thought of in Solihull and is now fondly remembered. I have spoken to Percy Grieve within the past week. I found him in very good form. He was very busy and very well. Hon. Members on both sides of the House will be pleased to hear that good report and will no doubt join me in wishing him well.
It is a privilege for me to represent Solihull, which is my home town. It is one of the most elegant towns in England and is a very pleasant suburb. In recent years the pace of change has caused some of us some anxiety. Being on the very edge of the west midlands conurbation, Solihull is a town where anxieties about green belt policies are keenly felt. The people of Solihull are enlightened, hard-working, diligent and tolerant, and as a native and resident I aspire to be typical of them in serving them in this House.
We are discussing the European Community budget and the crisis associated with it. The President of the European Commission has been quoted as saying:
It is no longer possible to put off the day of reckoning. The exhaustion of our own resources has put our backs against the wall.
My right hon. and learned Friend the Foreign Secretary rightly said that in every crisis there is an opportunity. Those who have the good of the European Community at heart, care about its well-being and want to see it do well,


realise that this crisis must be exploited to the full in the interests of our country. Caring about the interests of one's country is not incompatible with being a good European. Abandoning the interests of one's country at the first call, however, is inconsistent with being a good European.
Like other hon. Members, I believe that we must put the European Community budget right and that this is the crucial chance to do so. We have attempted to force the pressure in the past at the annual farm price review, but in the end that ambush proved too predictable and was passed through. This is a critical opportunity, and we should take it. There should be no fudge and no compromise. We should hold firmly to our bargaining advantage. If we do, the budget argument will be taken out of the political institutions of the European Community. The Commission, the Council and the Parliament spend far too much time arguing about the budget.
If we could put this matter right we should render a great service to our country, where public perception of the Community may improve very considerably if the rowing stopped. It would be like taking a thorn out of the paw of British public opinion. We should also do much good in Europe and enable people to start discussing progressive developments in the Community and to get on with the job of strengthening Europe and the member states. I wish the Government well in Athens. I wish them success.

Mr. Nigel Spearing: I believe that the hon. Member for Solihull (Mr. Taylor) speaks from experience as a present or former Member of the European Parliament. We look forward to hearing from him again in future debates on European matters. I wondered at one time whether he would be as bold as the hon. Member for Watford (Mr. Garel-Jones), who in his maiden speech made it clear that he disagreed with the then Government. The House will appreciate the hon. Gentleman's comments about his precedessor, Mr. Percy Grieve, whose legal erudition was well known here and whose contributions are well remembered.
Like the hon. Gentleman, I do not wish to be too controversial, and I too wish to recall a predecessor, a past Chairman of the Select Committee on European Legislation, Julius Silverman, who served in that office with great patience, skill, impartiality and accuracy. In its deliberations, the Committee to which my hon. Friend the Member for Livingston (Mr. Cook) has already referred is not concerned with merits. It assesses the legal or political impact of EC legislation on the United Kingdom. It reports on matters of principle, and recommends how the House should proceed on more controversial issues. It issues weekly reports which would be an invaluable guide to hon. Members and to their constituents on the way in which EC legislation could affect their interests. When major issues arise, such as the one before us this evening, it issues full reports. Having considered EC document 6863/83 on the future finances of the Community, the Committee issued a report, H.C. 78-vi, and a report of the Committee's proceedings, H.C. 126-i.
The Committee decided, at its first meeting after the summer recess on 26 October, to request the Chancellor of the Exchequer to report to us. Unfortunately, he was not able to suggest a date before 21 November, and when that

date arrived he wrote to me apologising for his absence and the Economic Secretary to the Treasury stood in for him. We are glad to see the Economic Secretary here. The hon. Gentleman conveyed the Chancellor's
sincere apologies for not being present to give evidence to the Committee. I know he did warn you some time ago that the pressure of events at this exceptionally busy time of the year after the Autumn Statement might force him to stand down.
However, the Economic Secretary was with us and we used the information that he gave us, then and later, in our report.
The first part of our report links the taxation measures of the EC with those of the United Kingdom. Last year, no less than £2,863 million went in contributions to the EC:£1,154 million in VAT and £1,269 million in customs and levies. In return, we received £1,238 million, of which £791 million was in the form of agricultural receipts. We discussed the question of a fairer system. In answer to question 51, the Economic Secretary made it clear that the imbalance of agricultural expenditure would make it difficult to achieve any greater balance in EC receipts in this country by increasing expenditure in other ways. Regional and social funds and the guidance part of the agriculture funds are referred to in EC jargon as structural funds. The use of those funds is often advocated in this House as one way of balancing our contributions. The Government would agree that that is not possible, and members of the Government said so during Committee hearings.
One other feature that the Committee found — we were surprised by it—is illustrated in table 3. It was the extent to which West Germany was continuing to pay a major contribution to Community funds. Well before the refunds which, after the Dublin mandate, are now negotiated annually, the German contribution was very much higher than our own. It will continue to be so as long as the contributions last. To some extent, the Germans have at least as good a case on refunds as the United Kingdom.
My hon. Friend the Member for Livingston has already commented on some misconceptions about VAT. In The Times on 1 December there was a story entitled "Tory MPs threaten rebellion". Ignoring that controversial suggestion, I shall quote from it:
At present the Community's funds are limited to the yield of 1 per cent. of the value-added tax levied in each member-state.
My hon. Friend made it clear that it is not so. Unfortunately, that idea has obtained wide currency both in newspaper articles and in people's minds. He explained that it is at a rate of 1·7 per cent. of VAT. In doing the arithmetic, which was confirmed subsequently by the Treasury, we found that no less than 11·2 per cent. of the 1982 VAT yield was passed to Brussels by means of the own resources mechanism. If the 1·4 per cent. limit is raised, that percentage would increase.
Another factor is that we pay in sterling, and if the ECU-sterling exchange rate changes, it will change the amount that we have to pay. Annually the Chancellor of the Exchequer does not just have this considerable sum as a first call on his payment out: he does not always know just how much it will be because if sterling declines the sum that he has to allocate from VAT and the Consolidated Fund will increase.
We hope that our report will be helpful to the House in reaching a conclusion now and in future debates after Athens. It has been pointed out already that the power over


the levying of taxation and of its spending was the means whereby the House gained its power and the centrality of that power will not be lost on hon. Members, nor was it lost on the Select Committee which may in future invite the Chancellor of the Exchequer to give further evidence if further reports are deemed necessary.

Mr. Edward Heath: I am prompted to make a brief intervention in the debate because of the attack on my right hon. and learned Friend the Foreign Secretary by my right hon. Friend the Member for Stafford (Sir H. Fraser). I believe that the Foreign Secretary is absolutely right in the negotiating attitude that he has adopted and put before the House today.
I congratulate my hon. Friend the Member for Solihull (Mr. Taylor) most warmly on his maiden speech. I hope that he will forgive me if I say that it was in many ways a model of a maiden speech, with its happy reference to his predecessor, to his constituents, and then to the subject of the debate, all in the space of some six or seven minutes. I congratulate him warmly upon the substance and the manner of the delivery of his speech.
I agree with my hon. Friend when he says that once the budget is settled we can move forward in the Community in many ways which will be of enormous benefit to the country and our people. I shall add to his sentence that it might also be for the good of the Community. It is that sense of working for the good of the Community that has, alas, been so often lacking from this country's activities and those of its Governments over the past seven or eight years. I wholeheartedly agree with what he said in that respect.
I have never commented on the speech that the right hon. Member for Down, South (Mr. Powell) made on this matter on an earlier occasion, and I do not particularly want to comment upon it today, except to say that history has passed him by. Of that history—of which he is so proud—his knowledge has always been scanty and is now non-existent. The matter has been settled, and perhaps one day the time will come—I hope that it will—when he will recognise that fact and perhaps become a happier man.
One of the greatest battles of the 1930s was over the Government of India Bill. It was fought vociferously, particularly on this side of the House, by a large group who opposed it, of whom Churchill was the foremost. When the Government of India Act was passed, it was settled and accepted. Churchill was big and gracious enough to say that it was settled and that he accepted it. It is a pity that the opponents of the European Movement and our membership of the European Community cannot take the same attitude.
The Opposition's views are changing. I am not criticising them in this respect, although I shall shortly criticise them in another respect. The Foreign Secretary's attitude is right because, first, he is saying that there must be proper control of budgetary expenditure, and, secondly, that there must be proper control of agricultural policy. I am firmly in agreement with those two matters and always have been.
What is difficult about today's debates is that they are entirely artificial. The first debate about the budget and the second is about the common agricultural policy. I understand that that is because the Opposition wish to vote

on the budget issue because they still believe that there is something to be got out of it, but do not want to on the issue of common agricultural policy.
I understand that view, because there was a time, when I first came into the House, when the Labour party prided itself on the fact that it was the party of the farmer and the farm worker. It had a great Minister of Agriculture and Fisheries in Tom Williams, who achieved a great deal for agriculture in the post-war world. The Labour party has now abandoned all that. It no longer cares in the least about the farmer or the agricultural worker. As a result, it has lost both its industrial and its agricultural base, which is why it is in the lamentable position in which it now finds itself.

Mr. Robin Cook: rose——

Mr. Heath: I shall give way if the hon. Gentleman is proposing to explain that lamentable position.

Mr. Cook: The right hon. Gentleman referred to Tom Williams. He will be pleased to know that the Labour party stands by the farming system which he introduced, because it was a system of deficiency payments which was fair and decent not just to the farmer and farm worker, but to the consumer as well. It did not, as the present system does, oblige the consumer to assist the farmer and pay twice as much as the farmer receives in benefit from the CAP.

Mr. Heath: I shall come to that point. The other interesting fact is that since these debates began the Opposition have never put forward a constructive proposal for changing the CAP. They have talked constantly in the way in which the hon. Gentleman talked this evening. Agricultural problems exist everywhere. The hon. Gentleman referred to milk surpluses. I sat in Cabinet for many years, under the old system as well as the new and we debated the price review every February. There was constantly argument about milk. In those days it was whether the farmer was to receive an extra three farthings or three halfpence. We knew full well that there would be milk surpluses. If we cut back on the price, the farmer only produced more milk to maintain his standard of living.
That is a characteristic of agriculture. People who talk in general terms only about reforming the policy, without making a single constructive suggestion, are kidding themselves about how to deal with what is a permanent agricultural problem in every part of the world except the developing countries, where there is insufficient production and to which no effective solution has been found.
British farmers have done extraordinarily well under the CAP. If the Conservative party wishes to maintain the confidence of farming, I suggest that it should take that fact into consideration when it talks glibly about cutting here and there and doing away with the benefits that the farmers and farm workers have had. What will be the consequences for the Chancellor of the Exchequer of taking milk out of the CAP and returning it to our budget? Those are basic matters which no one has taken into account when talking glibly about reform.
I want to come to the subject of negotiations and why the Foreign Secretary is right. It is vital to gain control of monetary expenditure and the CAP. We shall not achieve that by saying to the rest of the Community, "and we will not accept anything else." Linking those two matters was


the fatal mistake that was made last year during the price review negotiations. The Community knew that we wanted the price review and had accepted it. It knew that our farmers wanted it. We said, "No, we will not have it, because we want the budget." The Community is not prepared to stand for that, and neither would we in its position. Those nine countries have a far greater proportion of their population involved in agriculture than we have. They knew that we wanted the price review for our farmers, but that we would not agree because we demanded something else on the budget.
They will not stand for that, and that is why the Foreign Secretary is right this time. He is not making the same mistake. He is saying that we should go for control of budgetary expenditure and control of the common agricultural policy, and that if we get that we shall be prepared to consider, in the development of the Community, the whole question of the other resources. That is a fair, reasonable and justifiable positon to take, and it is one that the Community will appreciate.
We want more development of the Community. We shall benefit from that in the Common Market, but let us not try to kid the Community that we are doing it for the good of the Community as a whole.
Let us consider the question of insurance. We badly need a common market in insurance, but who will benefit most from it? It will be Lloyd's and the City of London. The Community knows that, so let us not try to kid the Community that we are doing it for a motive that is beyond discussion. We are, of course, doing it for our own interests.
Then let us accept that other countries in the Community also have interests and that they may involve the question of the extra resources. Therefore, the Foreign Secretary is right to say that this matter can be considered and that a considered judgment can be made on it.
My right hon. Friend the Member for Stafford says that he tabled his motion to help the Foreign Secretary. That may have been his intention.

Sir Hugh Fraser: It was. I did things in the past to help my right hon. Friend.

Mr. Heath: My right hon. Friend says that he did things to help me as well. I accept that, but from the point of view of negotiations in Athens, the Foreign Secretary and the Prime Minister are right. From the point of view of the Community as the Prime Minister said repeatedly at the election—and has repeated since—it is essential that we remain a member of the Community for political reasons, to strengthen NATO, and to help our economy. If those three statements are true, the Community expects us to take an attitude that will help the Community in its development. It cannot believe that we are genuine if we take any other attitude.
No doubt my right hon. Friend the Minister of Agriculture, Fisheries and Food will have to outline his attitude to the suggestions about prices for commodities. It has not escaped notice in the Community that the commodities that are being crossed off are the ones that do not affect us, and the ones to be left are those from which we shall benefit. That is too simple an approach, and the Community can see that, so the Minister of Agriculture will have to adjust that.
When the control is settled, it should be in a form that is flexible. The Community is not static. No member state will remain in the same position financially or from the point of view of total production in relation to the other members. When we went into the Community negotiations we were the second richest country in the Community—second to the Germans. Then we were overtaken by the French, and now others have overtaken us. We are now seventh or eighth. The Community is not static, so any arrangements that are negotiated must be flexible to deal with the changing positions of the countries in the Community.
Perhaps I might say a word about Spain and Portugal. They should come into the Community because they are now both democratic countries, and our democracy can be strengthened by their coming in. I lived through the period when Spain went from being a constitutional monarchy into being a republic, into a civil war and into a totalitarian dictatorship. Now it is a democracy, and a worthy democracy. No tribute to the King of Spain could be too high for the part that he has played in bringing about that democracy. He has a British background and a large knowledge of British history and British parliamentary tradition. So Spain and Portugal should come into the Community to strengthen their own democracies and prevent the recurrence of a dictatorship. I should have thought that Opposition Members would agreed with that.
Those are my few thoughts. Above all, I repeat that the Foreign Secretary and the Prime Minister are absolutely right in the negotiating position that they have established.

Mr. Russell Johnston: I wish to associate myself warmly with the congratulations that have already been offered to the hon. Member for Solihull (Mr. Taylor) on his maiden speech, which was well informed and pleasingly succinct.
I am in no doubt whatever that the own resources of the Community must be increased. [HON. MEMBERS: "We knew that."' That would be so, even were we not politically committed to its enlargement by the inclusion of Spain and Portugal. When they join, they will simply fortify what I believe is an unanswerable case, which has already been exceedingly well put by the right hon. Member for Old Bexley and Sidcup (Mr. Heath).
The unconditional rejection of that course, which has been spelt out in identical words in the Labour party's amendment and in the early-day motion signed by about 60 Conservative Members, is not a policy. It is a Luddite abdication of leadership. I dare say that the so-called official Opposition think that it is an astute and clever move to table an amendment for which more than 60 Conservative Members have already declared their support. In fact, it is rather sad and symptomatic of their narrow approach to political dialogue that, at what everyone, of whatever opinion, agrees is a watershed in Community affairs, they should give priority to extracting the maximum domestic political advantage, and be evidently more interested in embarrassing the Government than in facing the issues. With respect to the hon. Member for Livingston (Mr. Cook), it also makes a mockery of the Leader of the Opposition's much publicised reappraisal of the Labour party's election commitment to withdraw from the Community, which the votes of the public at the last election roundly rejected—even if that is not reflected in the House because of our warped electoral system.

Mr. Robin Cook: As the hon. Gentleman's party normally attacks the Conservative and Labour parties for their failure to seek common ground and for perpetually calling each other names, I find it a little hard that we should be attacked when we try to find common ground with Conservative Members. In his very first sentence, the hon. Gentleman ran up the flag of surrender and said that own resources should be increased. Are we to take it from the fact that he has not since referred to any conditions on that increase in own resources that he is now prepared to surrender and grant an increase in own resources without even the conditions that at least the Government are requesting?

Mr. Johnston: If the hon. Gentleman will be patient, I shall come to that matter.
I shall briefly refer to the nature of this debate. Certainly neither Liberals nor Social Democrats had any say in its structure. I see no point in the division between the budget on the one hand and the common agricultural policy on the other. It would have been much more sensible to have a full day's debate on future financing, rather than an artificial division which, in my opinion, inhibits the proper conduct of an integrated debate. In fact, I do not know why the Government agreed to it. Frankly, it is stupid. I hope that next time there will be much more general consultation on these matters.
I come now to the matter that the hon. Member for Livingston raised. I said that both the Labour amendment and the Conservative early-day motion were unconditional. In seeking to resolve the complex of interests within the Community and simultaneously give it a forward dynamic, Liberals and Social Democrats, in accepting and arguing for the need for a larger budget, do not do so unconditionally.
We reject entirely the juste retour—the "it is our own money" approach—as blocking the aims of economic convergence and equivalence of social standards, which are at the heart of the ideals that motivated those who, like ourselves, have long made the Community case—one would think that the Socialists, too, would do so—and accept that the Government are right in seeking a system of contribution that takes account of GNP and in insisting that a mechanism be found to put a stop to the open-ended subsidisation of agriculture production, irrespective of demand.
It is foolish, as the right hon. Member for Old Bexley and Sidcup pointed out, to be simplistic about this. For example, there are 1,600,000 dairy producers in the Community but 70 per cent. of production stems from only 250,000 of them. If one tries a price solution to the problem, it has to be reduced by 20 per cent. at least which would cut a swathe across European agriculture, put people on the unemployment queues everywhere and wreck the rural economy. That is not a sensible approach. I therefore favour the quota approach that is being worked out in the Council of Ministers. The hon. Member for Livingston is therefore wrong to suggest that in the alliance we advocate an increase in funds without condition. What we say, and have repeatedly said, is that the Community is about economic convergence.
I was in Portugal last week with the bureau of the Liberal group of the European Parliament. In discussions with members of the Socialist-Social Democrat coalition Government about the Portuguese application we found that everyone at all levels up to Prime Minister Soares and

President Eanes was anxious to process the application as quickly as possible, while simultaneously being profoundly concerned at the lack of budgetary reform since as agricultural importers, to an even greater extent than the United Kingdom, under the present system they could, as pointed out by the hon. Member for Livingston, end up as net contributors. The hon. Gentleman is right in saying that that would be palpably absurd.
A consideration relevant to the British position is that in the absence of budgetary reform or an increase in own resources both Spain and Portugal inevitably will seek budgetary benefit primarily through the common agricultural policy, with consequent demands for greater support for Mediterranean products, and a continuing warping of the system.
Therefore, we are not in fundamental dispute with the key objectives of the Government within the budget and for the common agricultural policy, but we are definitely at variance with them in the limited Gaullist way they have approached these issues and the effect that this has had on our ability to be seen as seeking general reform as opposed simply to national advantage. After all, the Conservative Government negotiated entry and a Labour Government renegotiated our continuing membership. Neither of those Administrations, even after the conclusion of the negotiations to their declared satisfaction, attempted to take any lead in the development of Community policies.
The consequence has been to develop a now regrettably well-entrenched view among other Community Governments and within the Commission that we are only half-committed to the success of the Community and that further concessions to the British position would be unlikely to lead to a more positive general British approach.
In short, our supposedly very clever Foreign Office, in over-reacting, in my view, to the attitudes expressed in the Labour amendment and in the Conservative early-day motion, which in essence allege that the other nine countries of the Community are regularly in concert against us, has placed us in a weak and foolishly exposed negotiating position.
The reality, as the right hon. Member for Old Bexley and Sidcup said, is that British economic, political and security interests are inextricably bound up with the maintenance and further development of the European Community. British industry, in a number of sectors, is integrated into European production. Our most modern industries trade heavily with the Community.
The hon. Member for Livingston will know that in Scotland our so-called Silicon Valley exports well over 60 per cent., sometimes up to 90 per cent., of its products within the Community. Withdrawal would be cataclysmic. But what has been insufficiently stressed is that to stand still would simply be a policy of progressive disadvantage.
A joint report this year from the British, French, German, Italian and Dutch institutes of international affairs concluded:
It is not enough to hold on to those common policies that the Community so far has; in order to maintain the benefits which European integration has given to the Community's member states, we have to move ahead with new policies.
The memorandum presented by the Socialist French Government in September, which I have no time to speak about but which I assure hon. Members they would benefit much from studying, in setting out a series of proposals for progress in industry and technology against the


background of a widening gap between the EC and America and Japan, seems to provide an exciting agenda for advance which would also serve British interests well, given our strong existing research base. To make this politically acceptable and to initiate a genuine assault on the widening economic discrepancies within the Community would require also a significant strengthening of the present largely cosmetic regional and social funds. That would mean an acceptance by the Government of a positive view on public expenditure because the regional and social funds mean public expenditure.
In my part of the world an agricultural development programme for the Highlands was needed, but the Government were unprepared to meet their side of the proposal.
The alternative to this strategy, which I fear the Government may well pursue, is a minimal increase in European Community funding which would leave agriculture still the dominant area of expenditure and thus leave the United Kingdom at a continued structural disadvantage.
I cannot see the United Kingdom budgetary problems being resolved except through a marked increase in Community funding. It is the necessary foundation on which to build a foreign policy which will give all countries in Europe the possibility to contribute effectively to the issues of peace and stability in the world, which at present the United States and the Union of Soviet Socialist Republics decide between themselves.

Mr. Geoffrey Finsberg: The hon. Member for Livingston (Mr. Cook) ascribed a somewhat unusual constituency to me. In one sense I should rather like to be the Member there. It would show that Syria was a democracy instead of being a vile military dictatorship falling more and more under the spell of the Soviet Union.
If I had to ascribe the speech of the hon. Member to anything, it would be to those who scavenge round the rubbish tip looking for something that may titillate their attitude and their appetite. The hon. Gentleman, in his light style, goes tripping from defence to economics and now to foreign affairs as the reward for having helped to elect the new leader of the Opposition. I give him credit for it. He fills the place remarkably well and may he long remain making the sort of speech that cuts no ice.
I turn to the subject of the debate, to the early-day motion and to the amendment that stands in my name. Let me make two things crystal clear. First, I was asked to sign the early-day motion and at no time was I done the courtesy of being told I was to be one of the six sponsors—[Interruption.] It is perfectly true. Three sets of paper were thrust in front of me and I tried to find space. No one asked me to be a sponsor.
Secondly, my view upon the budget and the contribution that this country makes has always been very clear: that unless and until we got the assurances we wanted I was not prepared to support any increase. The intention behind the way this proposal was put to me seemed to strengthen the hand of the Government. On the following day, long before I came to the House, I saw on the Order Paper something rather strange in the large number of signatures. Then I read comments in the press

that showed clearly that there was more to the early-day motion than met the eye. I came to the House in order to serve upon the video nasties Bill Committee. I decided I would draft an amendment to represent my point of view, which I did. The amendment in my handwriting with my scribbles which I took to the Table Office bore no other signatures. It went in with my name only.
I resent the words used by my right hon. Friend the Member for Stafford (Sir H. Fraser) and those of the right hon. Member for Down, South (Mr. Powell) in referring to those who signed the amendment as being steeped in some kind of infamy. I leave him to judge whether he is a better judge of infamy than anyone else.

Mr. Teddy Taylor: That is not necessary.

Mr. Finsberg: My hon. Friend may be fortunate enough to catch the eye of the Chair, and if he does so, he will be able to make his own contribution. I am not prepared to be told by any hon. Member that my actions are infamous. I take my own actions and I am prepared to be answerable for them. I am not prepared to have adjectives such as "infamous" used about my actions.
I was glad that other right hon. and hon. Members and hon. Friends decided, for whatever reason, that they would not permit their names to remain upon the original early-day motion but were prepared to sign the proposal that I had tabled. I emphasise that I asked no one to sign my amendment.

Mr. Teddy Taylor: Terribly proper.

Mr. Finsberg: I wish occasionally that my hon. Friend would not keep talking from a sedentary position. He should not take that as an invitation to make an intervention. I ask him not to imagine that I shall allow him to intervene in my speech. I shall continue in the hope that he will not try to do so. I acquit him of any attempt to mislead me. I have known him for too long and he is too old a friend for me even to begin to think that he would do so.
Having clarified the position of the first name on the amendment, I shall explain why I believe that my right hon. Friend the Prime Minister should know that she has, with my right hon. and learned Friend the Foreign Secretary, the opportunity of proceeding with the support of Parliament. That is why I inserted in my amendment the words "and Parliament" in the context of any alterations that my right hon. Friends are able to obtain as a result of their negotiations.
I have never been as enthusiastic a European as my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath). However, I have always voted in favour of membership of the EC because I believe that to be in Britain's basic interests. I agree very much with my right hon. Friend that, whatever the right hon. Member for Down, South may say, the issue is dead. On more than two occasions the public have been faced with general elections at which that was the issue. They decisively repudiated the Luddite attitude that the right hon. Gentleman puts to us. The referendum equally decisively repudiated his view. Those who wish to continue to believe it may delude themselves if they wish, but they delude no one else.
I hope that my right hon. Friend the Prime Minister will go forward in the knowledge that Conservative Members, at any rate, will not be prepared to accept the sort of


negotiation and the sort of result that the hon. Member for Livingston suggested would be the outcome. I do not believe that my right hon. Friends would try to suggest that they wanted us to accept that sort of plan. I believe that they will negotiate properly first, by trying, to ensure that our own interests are paramount and, secondly, in order to achieve our own interests, by ascertaining what other interests can be incorporated and used in our support.
That may not be the way in which trade unions negotiate. I am a member of Clive Jenkins's union and it seems that he does not often negotiate in what I consider to be a sensible way. I have described the way in which I have negotiated with trade unions for 20 years, and it is also the way in which I have negotiated in commerce for 20 years. One does not start negotiations by saying, "We shall not accept anything that is put to us because we do not believe that it will be in our interests to do so."
I do not accept the thesis of the hon. Member for Livingston. Any protestations on his part that he is trying to help the Government ring pretty hollow in the light of his record and the record of his party. I am much more concerned to assure my right hon. Friend the Prime Minister that if the Government negotiate genuinely, as I think they will, and toughly, as they have, they will receive the backing of the Conservative party and that of the House. They know that in so doing they will retain the backing of the British public.

Mr. Allan Rogers: There is not much time left for debate if we are shortly to proceed to a vote. That being so, my contribution will have to be much shorter than I intended.
I am sorry that the right hon. Member for Old Bexley and Sidcup (Mr. Heath) has left the Chamber. The basis of his disgraceful attack on the right hon. Member for Down, South (Mr. Powell) was fragile and spurious to say the least.
Those who wish Britain to continue its membership of the European Community always bring up issues such as foreign affairs and defence as justification for their position. They sometimes forget that we are members of the North Atlantic Treaty Organisation and that we participate in foreign affairs and defence agreements with other countries.
I am not surprised by the stand of the Liberal-SDP alliance on this issue. The alliance is the pro-European party that wants to take us headlong down the path of European unity. When it has finished the discussions and arrangements with Dr. Bangemann and the European Liberals, who are to fund its election campaign next year, it will have further discussions with von Bismarck, von Hapsburg and Altiero Spinelli, in whose company I have been during the past three days in a European Parliament Committee discussing the preliminary draft treaty for establishing European union.
The right hon. Member for Old Bexley and Sidcup, in his attack upon the right hon. Member for Down, South, was wrong to suggest that we had reached a static position in the evolution of and relations between the countries of Europe. The position is not static. I recommend the hon. Member for Inverness, Nairn and Lochaber (Mr. Johnston) to read the draft report establishing European union. That report, produced by Mr. Spinelli, has already passed through the European Parliament and is now being prepared by legal experts for submission to national

Parliaments for ratification or otherwise. Hon. Members and others outside the House will be appalled when they realise what supporters of the alliance have in store for us as we rush headlong down the path to European union. I recommend hon. Members to read the Spinelli document. We are dealing with an evolving structure, and we should be aware of the consequences that will result from happenings outside this Chamber.
As a Labour Member of the European Parliament, I am used to seeing the Conservative party looking both ways at the same time, but it is strange that Conservative Members of the European Parliament should support the move towards European union. Sir Henry Plumb, a well chosen leader of the European democratic group in the European Parliament, suggested that he would gel his backside smacked by the Prime Minister when he returned for coming out with a statement supporting European union.
The Conservative party should examine and consider what some of its supporters and members are doing on the other side of the water. An example was given in the maiden speech of the hon. Member for Solihull (Mr. Taylor), whom I have come to know very well over the past four years. I congratulate him most warmly on his maiden speech.
We have now reached the last stage of the agreement that was made between the member states when they joined the Community. The Community is now going bust. It is as simple as that. We have seen today another demonstration of the Government's ineptness which has been developing over the past year. We have witnessed their capitulation.
The Government have ratted on their own people to serve the vested interests of their financial backers and supporters—the banks, big business, and, above all, the farmers. The right hon. Member for Old Bexley and Sidcup was wrong when he attacked our farming policy. He does not realise that the farming industry has moved on. We are talking not about the farmers whom Tom Williams looked after, but about the huge profits made by the City of London in its investments in areas such as East Anglia.
I accept that there are considerable difficulties for small farmers in the constituency of the hon. Member for Inverness, Nairn and Lochaber. Small farmers say that they get little help from the common agricultural policy. The Foreign Secretary is suggesting not a reformation, bur an adjustment of the common agricultural policy. The adjustments are, of course, on the basis of a sell-out.
In July, the Minister of Agriculture, Fisheries and Food told the House that he had managed to perambulate over to Brussels and had come back with a marvellous deal. That deal virtually sounded the death knell of fishermen' in the constituency of the hon. Member for Inverness. Nairn and Lochaber. The hon. Gentleman should ask those fishermen whether they get a good deal out of Europe.
Again in July, the right hon. Gentleman told the House that he had been over to Brussels and had agreed yet another farm price increase — an increase which was completely against the interests of the consumer and of this country.
We have seen a softening up process during the summer to prepare the country for the Prime Minister's return from Stuttgart with a rebate half the size of the one to which we are entitled. Ministers at the Dispatch Box tell us that they have had great victories in Europe. The Conservative


media have built up these treacheries into famous victories — such is the Government's power and control over them. Ministers were cheered on by Conservative Members who were grateful to their backers who had funded their election victory.
The result is that our fishing industry is dying. The ordinary people of this country, especially pensioners and those on fixed incomes, will pay even more for their food than at the beginning of the year. They were sold down the river and sacrificed for a so-called rebate of our own money. One would think that this rebate from Europe was a handout. That is how it is presented, but it is the recovery of our own money. The Foreign Secretary should note that and not use the misleading phrase "own resources". He should say what it really is — extra taxation on the British people to fund the present ridiculous policies in Europe.
What the right hon. and learned Gentleman does not tell us is that he has not yet got this rebate. As a result of what the European Parliament has decided, we can have the money back only on its conditions. That is not the first time such a thing has happened. Under the present Government, it is becoming a regular occurrence.
I accept that time is moving on, Mr. Speaker. Perhaps it would have been better if we had not had pathetic excuses for hon. Members' attitudes towards early-day motions and amendments and had got down to the business before us. I shall try to be brief.
The Prime Minister will be going to Athens. The right hon. Lady will wing off at the beginning of next week to take on the Mafia of Europe. She will return with an unacceptable deal. That deal has been outlined by my hon. Friend the Member for Livingston (Mr. Cook). The right hon. Lady will once more ride off on a white horse against the black knights of Europe for a shoot-out at the Acropolis. She will once more sell us down the river. The deal has already been decided. We shall have to pay extra taxation and hand over to the European Parliament and the Council of Ministers the right to call for further tranches of taxation. Effective powers and the legitimate right to tax the people of this country will be taken from this Parliament.
I am sorry that my speech has become a little disjointed, but I have had to throw away half of what I wanted to say.
I say to the Government, and especially to the Foreign Secretary who opened the debate but who has been absent for most of it—it is nice to see him back—that we on the Opposition Benches and half the Members on the Conservative Benches are not prepared to accept the blackmail of the other European countries. The right hon. and learned Gentleman should advise the Prime Minister to come back from Athens with something, because we are not going to accept these hypocrisies any more.

Mr. Tony Marlow: First, may I say to my hon. Friend the Member for Hampstead and Highgate (Mr. Finsberg) that it was my understanding that he was quite agreeable to being a sponsor of the early-day motion for which his name was put down. Apparently there was some misunderstanding, but I can assure him—I believe that he will accept this — that I would not have put his name in that position had that not been my understanding.
I am the author of the Opposition amendment which doubles as early-day motion 312. May I say how flattered I am that they have adopted it? Whether I actually dirty my shoes with them in the Lobby this evening does not mean to say that I do not support it and will not continue to support it wholeheartedly. I am flattered that 130 more of my hon. Friends signed that early-day motion and that the bulk of them still fundamentally believe in, and agree with, what it says. I am flattered that my hon. Friends in the Gest—[Interruption.]—in the Government Whip's office were so impressed by the motion that they mounted the strongest operation that I have seen in my four and a half years in the House, using every weapon at their disposal inside and outside the Geneva convention. I am at a loss to understand why they became so worked up and why they over-reacted. I have heard that the operation got under way before my right hon. Friend the Prime Minister had got off the aeroplane and that she finds early-day motion 312 quite helpful.
There is no great difference in substance between the two motions. Neither would allow an increase in own resources under the present circumstances. But there is a massive psychological difference. By forcing some of my colleagues to sign the amendment to the early-day motion, the Government Whips have opened the door at this stage of the negotiations to an increase in own resources. It is a signal — not just a mild smoke signal but a green searchlight—to say to the other nine in Europe, "One more heave and the vaults are open." It reminds me of the story of the girl who said no and then invited the young gentleman to stay the night in her flat. If she did not mean no, she should not have said no. If she said no, she was naive and deserved all that she got.
The net budget since the Government came to power in 1979 has cost us on average £620 million a year. The figure for this year is not yet known but it seems to be something of an auction. Every time that someone says something about it, it seems to be a higher figure than the time before. It is at least £800 million. We could make good use of that money elsewhere. Never let us forget that our contribution to the budget is not the only bill that we pay to the Community. Our consumers are net importers of European foodstuffs, which they must buy at over and above world market prices. Therefore, we pay for the budget and for expensive foods.
A diminishing number of my hon. Friends will say that it is cheap at the price, and that we should consider the benefits. But what benefits do we in the United Kingdom get which are not freely and equally available to the French, the Italians, the Irish and the Dutch? We provide net markets for high-priced, imported, European foods. We provide a market for over £6,000 million net of European imports of manufactures. We provide the North sea fisheries. We provide North sea oil. We provide an extra political dimension. Why do we also have to provide the cash? It is unjust. Geographically, we are on the edge of the Community. Financially, I am sad to say, we are one of the less wealthy members. Why should we pay? We do not take money from Liverpool and give it to the southeast. [HON. MEMBERS: "Yes, we do.''] Why should the Community act as Robin Hood in reverse and rob the poor to pay the rich?
As I understand it, the Government will talk about the increases in own resources only if two prior conditions are met. The first condition is budget justice. Justice is justice.


Why need it be negotiated? Why need it be conditional? Why do we have to bribe the judge with a backhander on own resources?
Secondly, the CAP must be reformed. Many of my hon. Friends are doubtful that it can be reformed; but if it is, as the Foreign Secretary said earlier, there will be no need for additional own resources. What will the resources be spent on? Will they be in the form of rebates from the Community with strings attached, so that we must adopt policies to which we would not normally agree, as my right hon. Friend the Foreign Secretary admitted recently at Question Time? Is it so that we can have further European interventionist industrial policies? Does my right hon. Friend believe that Conservative Members will agree to that?
Is it, as my right hon. Friend the Member for Old Bexley and Sidcup said, so that we can enlarge the Community and admit Spain and Portugal as members? Will they not join unless they get the money? Are there no benefits for them other than cash? Why, when he was negotiating membership for the United Kingdom, did he not negotiate a generous bounty for the United Kingdom? Why should other countries get it when we do not?

Mr. Heath: We negotiated the transitional arrangements for seven years, and from that we benefited by £1·2 billion.

Mr. Marlow: That may he, but, as I said earlier, it has cost us on average £620 million a year over the past four years.
How can we talk about an increase in own resources when we in the Conservative party believe in controlling public expenditure and are bending every sinew to make sure that money is not wasted? How can we suggest that Europe should have more public expenditure? How can we suggest that, when we read the auditors' report about the massive waste and the lack of proper control of European money, when £100 million each year goes into the hands of the Mafia in southern Italy in the olive oil swindle? Until they prove that they can control spending adequately, how can we allocate them more money?
Many of my hon. Friends await in fear and trepidation that week in the spring when on the Tuesday we will be required to support the Government in the Lobby on some battle about cuts in the Health Service, in education or in local government finance and on the Wednesday we will have to troop through the Government Lobby in support of increased own resources to the Community. If I am asked to do that, I shall not do it. Many of my hon. Friends are arranging their pairs and their operations in advance so that they, too, will not have to be there in those circumstances.
The two alternatives in trying to achieve the Government's objective, which I believe I share, are either through negotiation or through force majeure—Frenchstyle "adamance". Given the mixture of vested interests and spatchcocked institutions that make up the EC, it is hard to be optimistic about negotiations. We only have to go back to last year to the event that my right hon. Friend mentioned — the negotiations on agricultural support prices—when the Exocet was thrown in and torpedoed the Luxembourg compromise. Against our will, prices were increased. Against our will, the budget was further disturbed. Our housewife had to put her hand deeper in her pocket; their farmers received the booty. They vote, we

pay. It is the Ken Livingstone syndrome. We will not take it at County hall; why should we take it from Brussels? At least, in support of Red Ken, may I say that he takes the money from the rich to give it to the poor rather than the other way round.
There is one way and one way only in which we can ensure fundamental reform of the Community. All of us, sceptics and enthusiasts alike, believe that we are in the Community — [Interruption.] Sceptics and enthusiasts alike believe that we are in the Community and will stay in Europe. We want reform for the benefit of the United Kingdom and for the benefit of Europe. There is only one way in which we can do it, and that is to hold the line of own resources. There will be no fundamental reforms as long as there is the slightest chance of a soft option, or the slightest chance of a fudge or a compromise. We have got rid of beer and sandwiches at No. 10; let us do without the bread and olives at Athens.

Dr. Oonagh McDonald: The debate has been interesting, in that there has been much agreement on both sides of the House. Many hon. Members have insisted that we have reached a crisis because of the amount of money that the European Community is frittering away, especially on the common agricultural policy, and that the crisis presents an opportunity that must be grasped to reform the agricultural policy and control spending once and for all.
We enjoyed listening to the hon. Member for Northampton, North (Mr. Marlow), although I was not sure whether he believed that we were members of the Conservative party attending a Conservative party conference, or whether we were hon. Members listening to a speech in the Chamber.
The maiden speech of the hon. Member for Solihull (Mr. Taylor) was succinct, perhaps mercifully so in view of what followed. He rightly said that we are presented with an opportunity in this crisis and that we should exploit it to the full. However, a jarring note was provided by the hon. Member for Inverness, Nairn and Lochaber (Mr. Johnston), who suggested that national interests should be set aside in favour of general reform. Can anyone imagine a French Deputy making a similar speech in the French Parliament?
The crisis in the Community has been caused by spending on agriculture, which is now completely out of control, with at least a 30 per cent. increase forecast for this year. The Community has an open-ended policy of buying up surplus foods in the market place, which means that spending must continue to increase. If the crunch is not reached this year—it has perhaps been avoided by the Commission trying to defer payments — it will certainly be reached in next year's budget, and each of us must seriously face the problems that that poses.
The way in which the agricultural policy has been getting out of hand has been described by the Court of Auditors in its report, which, although it is an official document, expressed the court's shock and horror and painted a devastating picture of waste and weakness in the Community's spending policy. Between 1973 and 1982, spending on agriculture increased by 183 per cent.
The Foreign Secretary mentioned in passing that Britain benefited from that expenditure, but this year the common agricultural policy will cost British consumers about £4 billion and will give back £2 billion to United Kingdom



farmers—a net cost of £2 billion on top of any budget contribution. This leads not only to wasteful expenditure but to an ill distribution of the wealth of the Community. Non-farmers together pay £30 billion per year to help farmers, and there is no reason to suppose that that will improve.
The time for temporary solutions to this problem has passed. The Foreign Secretary talks about a permanent solution. On 22 November 1979, when he was Chancellor of the Exchequer, he talked about the need for a permanent solution and about how the Government were determined to reach such a solution. He said:
Neither I nor any succeeding Chancellor will wish to make speeches in this House in a year or two about yet another debate within Europe on this same subject"— [Official Report, 22 November 1979; Vol. 974, c. 593–94.]
That is precisely what we are now doing, because the Government have not pressed for the permanent solution which they said they sought so long ago. Rather than an expression of strength before Athens, it is an expression of weakness.
It appears that the Athens meeting will fail. Those who have carefully read the press on this subject during the past few days will have noted how the press briefings have changed. The expectations for Athens have been toned down and there is talk of a solution by the spring or, perhaps, by June 1984. Athens may lay down the framework for a solution, but it cannot provide one. The failure that is likely to occur at Athens will perpetuate the unfairness in the Community.
Last year, net benefits per head in the United Kingdom were £24, in France £37 — the average for the Community—in Luxembourg £400 and in Ireland £152. We cannot leave this matter in the Commission's hands. We saw what the Commission did just before the last meeting in Athens, when it tried to massage the figures and managed to add £4 per head to the net gain that Britain had received. That action may have reduced the size of the British grievance, but it did not eliminate it. It leaves an unacceptable gap in net benefits between £28 per head and the average of £37 per head.
The fact that the Commission was prepared to massage the figures in that way leaves us with no confidence in its ability to end this unfairness. We cannot rely on the Commission. There must be Government action and firmness at Athens to insist on a permanent solution that will depend not just on controlling agricultural spending but on a radical reform of agricultural spending.
In November, in their pamphlet "Ripe for Reform", the right hon. Member for Stafford (Sir H. Fraser) and 54 of his hon. Friends wrote:
Since the Stuttgart Summit, a number of proposals for reform have been advanced from various sources, including the Commission, but the basic problem is that all these proposals have attracted objections from some member states; and even the most ambitious of the plans offers no hope of resolving the EEC's cash problems unless the resources of the EEC are to be increased. This must be unacceptable to a Conservative Government resolved to reduce Government expenditure.
We look forward to seeing how the right hon. Member for Stafford and his pamphleteers vote tonight. If there is no fundamental reform of the agricultural policy, there is bound to be an increase in the own resources of the Community. It seems that the Government are moving

away from that objective and have lowered their expectations. They are talking only in terms of reform. On 19 November The Economist stated:
Don't sell out on the CAP. The risk is that Mrs. Thatcher will be offered a reasonable deal on Britain's budget, but will accept in return a bad deal on the common agricultural policy, the CAP, the origin of budget inequity and much else. Such a trade-off will be urged on her by the barn-full of farmers in her cabinet. It is also being encouraged by Britain's ministry of agriculture.
If that is the type of deal that the Prime Minister is prepared to accept in Athens, it will lead to an increase in the own resources of the Community, which the Opposition oppose.
If the increase in own resources leaves the common agricultural policy unreformed, we could end up paying more to the EC than we do. We have already been told that we give the European Community 11 per cent. of the VAT take. What will happen if there is an increase in own resources and we end up paying more to the Community? Agricultural spending will get out of hand unless the fundamental structure of the policy is changed.
If we take the Chancellor's words seriously, any increase in public spending must be compensated for by an increase in taxation. The Chancellor might choose to increase those resources by putting up VAT. That could mean increasing VAT by 1 per cent., bringing it to 16 per cent. and adding 0·5 per cent. to the inflation rate, with an increase in costs of 37p per week for the average family.
The Commission has already cast its beady eye on the items that are zero rated in this country. It might encourage the Government to impose VAT on those items as well. That is the danger of the Government's stance, which was described by the hon. Member for Southend, East (Mr. Taylor) as too modest when he asked the Prime Minister about her objectives at the Athens summit. The Foreign Secretary in his opening statement gave no cause for increased confidence.
We feel that the Government will go to Athens, take little away, and refuse to push for the necessary radical restructuring of the common agricultural policy, so that we end up paying more into the Community budget. If that happens, we could all too easily find ourselves having to pay more in taxation or sacrifice other public goods.
That is why we have tabled our amendment to the Government's weak motion. We call on the right hon. Member for Stafford, his pamphleteers and those who last night managed to resist the blandishments of the Government Whips to join us in the Lobby to show that they mean what they say about there being no increase in the Community's resources.

The Economic Secretary to the Treasury (Mr. Ian Stewart): I congratulate my hon. Friend the Member for Solihull (Mr. Taylor) on his important contribution to the debate. He made a most distinguished speech and I hope that we shall hear more from him on this and on many other topics. I also express our appreciation of the work done by the hon. Member for Newham, South (Mr. Spearing) and the Scrutiny Committee to produce the sixth report so rapidly in time for today's debate.
It is most important that the House should have the opportunity to express its views before the summit meeting in Athens in a few days' time. The debate has certainly covered a diversity of views from all parts of the House.


I am sure that our fellow members of the European Community are in no doubt about the Government's determination to find a solution to the long-standing problems of the Community which will meet the requirements that we have put forward. Some right hon. and hon. Members who spoke today may have underestimated the effect of our proposals on imbalances and expenditure control. The safety net that we have proposed as a method of dealing with imbalances between one member state and another would cover matters such as relative prosperity which was raised by the hon. Member for Livingston (Mr. Cook) when he opened for the Opposition. That is an important characteristic of the method that we propose.
The whole system would enable us to avoid an annual round of bargaining — a debilitating and destructive process which too often dominates the affairs of the Community. I observe in passing that if the budgetary burden of the Community were more evenly distributed other member states would be encouraged to apply greater discipline in their approach to Community expenditure because they would be contributing more to the cost. It is no accident that many of those who have argued most strongly for an increase in own resources are among the largest net beneficiaries from the system in its present form.
Our proposals for control of expenditure, especially agricultural spending, would undoubtedly lead to measures of reform in the detailed application of the policy. The very fact that in the past agricultural expenditure has been virtually unlimited has meant that the Community has not addressed itself properly to the problems of the regimes, pricing policy and intervention which certainly need reform. As my right hon. and learned Friend the Foreign Secretary has said, income must determine expenditure and not the other way round.
Decisions on these two matters would profoundly affect the future financing of the Community. For that reason, we cannot judge at this stage whether there should be an increase in own resources. We remain to be convinced of that case, but we have said that we should be prepared to consider it.
The hon. Member for Livingston quoted part of a speech by the Minister of State, Foreign and Commonwealth office, my hon. Friend the Member for Edinburgh, Pentlands (Mr. Rifkind). My hon. Friend said:
The Government do not approach this question in a dogmatic of ideological way. We maintain that at present, for pragmatic reasons and for reasons relating to the natural buoyancy of existing arrangements, it is not necessary to contemplate a change of that kind.
That was a pragmatic comment in the conditions of the time. We shall be considering the conditions that apply to the future financing of the Community.

Mr. Robin Cook: To ensure fullness of the record, I should point out that in his quotation the Minister omitted his hon. Friend's statement that
the Government do not believe that the likely accession of Spain and Portugal to the Community, which we hope will happen in the relatively near future, will materially change own resources."—[Official Report, 21 February 1983; Vol. 37, c.744.]
In other words, when one reads the whole passage without leaving anything out it is clear that in February the Minister of State expressed the view that there was no case for change in own resources before or even after

enlargement of the Community, which is now at least two years away. What has happened since February to change the Government's position?

Mr. Stewart: The essential point that my hon. Friend was making was that the case for an increase in own resources was not then made. Nor is it now. As my right hon. and learned Friend the Foreign Secretary said when he opened today's debate, the burden of proof is on those who call for an increase. In the light of any agreement reached on the proposals that we have put forward, we shall judge whether there is a case for an increase in own resources. We cannot make a judgment until we know the financial basis for the Community in the years ahead.
I think that all hon. Members have recognised the need for major changes in the budgetary system of the Community in the future. All member states, not just the United Kingdom, need a solution to the problem. We wish to play a full, positive and constructive part in the future of the Community. I believe that in bringing these matters forcefully to the attention of our Community colleages we are acting in their best interests both now and in the longer term. This is a crucial chance to find the lasting solution to which the hon. Member for Thurrock (Dr. McDonald) referred. That needs to be done, and we are taking a lead in discussions to try to achieve it.
The Opposition amendment is not a realistic approach to the problem in current circumstances. We cannot make any unconditional commitment for the indefinite future. My right hon. Friend the Prime Minister agreed with colleagues in Stuttgart in the summer that we should be prepared to consider the matter if our other conditions were satisfied. She should not be asked to go back on that undertaking. In this, as in so many other matters, the Government have shown a consistency and a sense of purpose and determination incomprehensible to the Opposition. I urge my right hon. and hon. Friends to reject the amendment.

Question put, That the amendment be made:—

The House divided: Ayes 170, Noes 316.

Division No. 84]
[7.07 pm


AYES


Adams, Allen (Paisley N)
Coleman, Donald


Aitken, Jonathan
Concannon, Rt Hon J. D.


Anderson, Donald
Cook, Robin F. (Livingston)


Ashley, Rt Hon Jack
Corbett, Robin


Ashton, Joe
Corbyn, Jeremy


Atkinson, N. (Tottenham)
Cowans, Harry


Bagier, Gordon A. T.
Crowther, Stan


Banks, Tony (Newham NW)
Cunningham, Dr John


Barron, Kevin
Davies, Rt Hon Denzil (L'lli)


Beckett, Mrs Margaret
Davies, Ronald (Caerphilly)


Beggs, Roy
Davis, Terry (B'ham, H'ge H'l)


Bennett, A. (Dent'n &amp; Red'sh)
Deakins, Eric


Bidwell, Sydney
Dewar, Donald


Blair, Anthony
Dixon, Donald


Body, Richard
Dobson, Frank


Boothroyd, Miss Betty
Dormand, Jack


Boyes, Roland
Dubs, Alfred


Brown, Hugh D. (Provan)
Duffy, A. E. P.


Brown, N. (N'c'tle-u-Tyne E)
Dunwoody, Hon Mrs G.


Brown, R. (N'c'tle-u-Tyne N)
Eadie, Alex


Brown, Ron (E'burgh, Leith)
Eastham, Ken


Callaghan, Jim (Heyw'd &amp; M)
Evans, loan (Cynon Valley)


Canavan, Dennis
Ewing, Harry


Carter-Jones, Lewis
Faulds, Andrew


Clark, Dr David (S Shields)
Field, Frank (Birkenhead)


Clarke, Thomas
Fisher, Mark


Clay, Robert
Flannery, Martin


Cocks, Rt Hon M. (Bristol S.)
Foot, Rt Hon Michael


Cohen, Harry
Forrester, John






Forsythe, Clifford (S Antrim)
Moate, Roger


Foster, Derek
Molyneaux, Rt Hon James


Foulkes, George
Morris, Rt Hon A. (W'shawe)


Fraser, Rt Hon Sir Hugh
Nellist, David


Fraser, J. (Norwood)
Nicholson, J.


Freeson, Rt Hon Reginald
Oakes, Rt Hon Gordon


Garrett, W. E.
O'Brien, William


George, Bruce
O'Neill, Martin


Gilbert, Rt Hon Dr John
Paisley, Rev Ian


Golding, John
Park, George


Gould, Bryan
Patchett, Terry


Hamilton, W. W. (Central Fife)
Pike, Peter


Harman, Ms Harriet
Powell, Rt Hon J. E. (S Down)


Harrison, Rt Hon Walter
Powell, Raymond (Ogmore)


Hart, Rt Hon Dame Judith
Prescott, John


Healey, Rt Hon Denis
Proctor, K. Harvey


Heffer, Eric S.
Radice, Giles


Hogg, N. (C'nauld &amp; Kilsyth)
Randall, Stuart


Holland, Stuart (Vauxhall)
Redmond, M.


Home Robertson, John
Rees, Rt Hon M. (Leeds S)


Howell, Rt Hon D. (S'heath)
Richardson, Ms Jo


Hughes, Mark (Durham)
Roberts, Allan (Bootle)


Hughes, Robert (Aberdeen N)
Roberts, Ernest (Hackney N)


Hughes, Roy (Newport East)
Rogers, Allan


Hughes, Sean (Knowsley S)
Rooker, J. W.


Janner, Hon Greville
Ross, Ernest (Dundee W)


John, Brynmor
Ross, Wm. (Londonderry)


Jones, Barry (Alyn &amp; Deeside)
Rowlands, Ted


Kilfedder, James A.
Ryman, John


Kilroy-Silk, Robert
Sedgemore, Brian


Kinnock, Rt Hon Neil
Sheerman, Barry


Lamond, James
Sheldon, Rt Hon R.


Leadbitter, Ted
Shepherd, Richard (Aldridge)


Leighton, Ronald
Shore, Rt Hon Peter


Lewis, Ron (Carlisle)
Short, Mrs R.(W'hampt'n NE)


Lewis, Terence (Worsley)
Silkin, Rt Hon J.



Litherland, Robert
Skinner, Dennis


Lloyd, Tony (Stretford)
Smith, C.(Isl'ton S &amp; F'bury)


Lofthouse, Geoffrey
Smith, Rt Hon J. (M'kl'ds E)


McCartney, Hugh
Soley, Clive


McDonald, Dr Oonagh
Spearing, Nigel


McKelvey, William
Stewart, Rt Hon D. (W Isles)


Mackenzie, Rt Hon Gregor
Stott, Roger


McNamara, Kevin
Taylor, Teddy (S'end E)


McTaggart, Robert
Thomas, Dafydd (Merioneth)


McWilliam, John
Tinn, James


Madden, Max
Torney, Tom


Maginnis, Ken
Wardell, Gareth (Gower)


Marek, Dr John
Wareing, Robert


Marshall, David (Shettleston)
Weetch, Ken


Martin, Michael
Williams, Rt Hon A.


Maxton, John
Wilson, Gordon


Maynard, Miss Joan
Winnick, David


Meacher, Michael
Woodall, Alec


Michie, William



Mikardo, Ian
Tellers for the Ayes:


Millan, Rt Hon Bruce
Mr. Frank Haynes and


Mitchell, Austin (G't Grimsby)
Mr. Allen McKay.




NOES


Adley, Robert
Biggs-Davison, Sir John


Alexander, Richard
Blaker, Rt Hon Sir Peter


Alison, Rt Hon Michael
Bonsor, Sir Nicholas


Alton, David
Bottomley, Peter


Amess, David
Bowden, A. (Brighton K'to'n)


Ancram, Michael
Bowden, Gerald (Dulwich)


Arnold, Tom
Boyson, Dr Rhodes


Ashby, David
Braine, Sir Bernard


Aspinwall, Jack
Brandon-Bravo, Martin


Atkins, Robert (South Ribble)
Bright, Graham


Atkinson, David (B'm'th E)
Brinton, Tim


Baker, Kenneth (Mole Valley)
Brittan, Rt Hon Leon


Baker, Nicholas (N Dorset)
Brooke, Hon Peter


Baldry, Anthony
Brown, M. (Brigg &amp; Cl'thpes)


Bellingham, Henry
Bruce, Malcolm


Bendall, Vivian
Bryan, Sir Paul


Benyon, William
Buchanan-Smith, Rt Hon A.


Berry, Sir Anthony
Buck, Sir Antony


Best, Keith
Bulmer, Esmond


Biffen, Rt Hon John
Burt, Alistair





Butcher, John
Heseltine, Rt Hon Michael


Butterfill, John
Hickmet, Richard


Carlile, Alexander (Montg'y)
Hicks, Robert


Carlisle, John (N Luton)
Higgins, Rt Hon Terence L.


Carlisle, Kenneth (Lincoln)
Hind, Kenneth


Carttiss, Michael
Hirst, Michael


Cartwright, John
Hogg, Hon Douglas (Gr'th'm)


Chalker, Mrs Lynda
Holland, Sir Philip (Gedling)


Chapman, Sydney
Holt, Richard


Chope, Christopher
Hooson, Tom


Churchill, W. S.
Hordern, Peter


Clark, Hon A. (Plym'th S'n)
Howard, Michael


Clark, Dr Michael (Rochford)
Howarth, Alan (Stratf'd-on-A)


Clark, Sir W. (Croydon S)
Howe, Rt Hon Sir Geoffrey


Clarke Kenneth (Rushcliffe)
Howell, Rt Hon D. (G'ldford)


Clegg, Sir Walter
Hubbard-Miles, Peter


Cockeram, Eric
Hunt, David (Wirral)


Colvin, Michael
Hunt, John (Ravensbourne)


Conway, Derek
Hunter, Andrew


Coombs, Simon
Irving, Charles


Cope, John
Jackson, Robert


Couchman, James
Jenkin, Rt Hon Patrick


Crouch, David
Johnson-Smith, Sir Geoffrey


Currie, Mrs Edwina
Johnston, Russell


Dickens, Geoffrey
Jones, Gwilym (Cardiff N)


Dicks, T.
Jones, Robert (W Herts)


Dorrell, Stephen
Jopling, Rt Hon Michael


du Cann, Rt Hon Edward
Kellett-Bowman, Mrs Elaine


Dunn, Robert
Kennedy, Charles


Durant, Tony
Kershaw, Sir Anthony


Dykes, Hugh
Key, Robert


Edwards, Rt Hon N. (P'broke)
King, Roger (B'ham N'field)


Evennett, David
King, Rt Hon Tom


Eyre, Reginald
Kirkwood, Archibald


Fairbairn, Nicholas
Knight, Gregory (Derby N)


Fallon, Michael
Knowles, Michael


Favell, Anthony
Knox, David


Fenner, Mrs Peggy
Lamont, Norman


Finsberg, Geoffrey
Lang, Ian


Fletcher, Alexander
Latham, Michael


Fookes, Miss Janet
Lawler, Geoffrey


Forman, Nigel
Lawrence, Ivan


Fowler, Rt Hon Norman
Lawson, Rt Hon Nigel


Fox, Marcus
Lennox-Boyd, Hon Mark


Franks, Cecil
Lester, Jim


Freeman, Roger
Lightbown, David


Freud, Clement
Lloyd, Ian (Havant)


Gale, Roger
Lloyd, Peter, (Fareham)


Galley, Roy
Lord, Michael


Gardiner, George (Reigate)
Lyell, Nicholas


Gardner, Sir Edward (Fylde)
McCrindle, Robert


Garel-Jones, Tristan
McCurley, Mrs Anna


Gilmour, Rt Hon Sir Ian
Macfarlane, Neil


Glyn, Dr Alan
MacGregor, John


Goodhart, Sir Philip
MacKay, Andrew (Berkshire)


Goodlad, Alastair
MacKay, John (Argyll &amp; Bute)


Gow, Ian
Maclean, David John.


Gower, Sir Raymond
Maclennan, Robert


Greenway, Harry
Macmillan, Rt Hon M.


Gregory, Conal
McNair-Wilson, M. (N'bury)


Griffiths, Peter (Portsm'th N)
McNair-Wilson, P. (New F'st)


Grist, Ian
McQuarrie, Albert


Ground, Patrick
Madel, David


Grylls, Michael
Major, John


Gummer, John Selwyn
Malins, Humfrey


Hamilton, Hon A. (Epsom)
Malone, Gerald


Hampson, Dr Keith
Maples, John


Hanley, Jeremy
Marland, Paul


Hannam,John
Marshall, Michael (Arundel)


Hargreaves, Kenneth
Mates, Michael


Harris, David
Mawhinney, Dr Brian


Harvey, Robert
Maxwell-Hyslop, Robin


Haselhurst, Alan
Mayhew, Sir Patrick


Havers, Rt Hon Sir Michael
Meadowcroft, Michael


Hayes, J.
Mellor, David


Hayhoe, Barney
Miller, Hal (B'grove)


Hayward, Robert
Mills, Iain (Meriden)


Heath, Rt Hon Edward
Mills, Sir Peter (West Devon)



Heddle, John
Miscampbell, Norman


Henderson, Barry
Mitchell, David (NW Hants)






Monro, Sir Hector
Speller, Tony


Montgomery, Fergus
Spence, John


Moore, John
Spencer, D.


Morrison, Hon C. (Devizes)
Spicer, Jim (W Dorset)


Moynihan, Hon C.
Spicer, Michael (S Worcs)


Mudd, David
Squire, Robin


Needham, Richard
Stanbrook, Ivor


Nelson, Anthony
Steel, Rt Hon David


Neubert, Michael
Steen, Anthony


Newton, Tony
Stern, Michael


Nicholls, Patrick
Stevens, Lewis (Nuneaton)


Norris, Steven
Stevens, Martin (Fulham)


Ottaway, Richard
Stewart, Allan (Eastwood)


Page, John (Harrow W)
Stewart, Andrew (Sherwood)


Page, Richard (Herts SW)
Stewart, Ian (N Hertf'dshire)


Parkinson, Rt Hon Cecil
Stradling Thomas, J.


Parris, Matthew
Sumberg, David


Patten, John (Oxford)
Tapsell, Peter


Pattie, Geoffrey
Taylor, Rt Hon John David


Pawsey, James
Temple-Morris, Peter


Peacock, Mrs Elizabeth
Terlezki, Stefan


Pink, R. Bonner
Thatcher, Rt Hon Mrs M.


Pollock, Alexander
Thomas, Rt Hon Peter


Porter, Barry
Thompson, Donald (Calder V)


Powell, William (Corby)
Thompson, Patrick (N'ich N)


Powley, John
Thorne, Neil (Ilford S)


Price, Sir David
Thurnham, Peter


Prior, Rt Hon James
Townsend, Cyril D. (B'heath)


Pym, Rt Hon Francis
Tracey, Richard


Raison, Rt Hon Timothy
Trippier, David


Rathbone, Tim
Twinn, Dr Ian


Rees, Rt Hon Peter (Dover)
van Straubenzee, Sir W.


Renton, Tim
Vaughan, Dr Gerard


Rhodes James, Robert
Viggers, Peter


Rhys Williams, Sir Brandon
Waddington, David


Ridsdale, Sir Julian
Wakeham, Rt Hon John


Rifkind, Malcolm
Waldegrave, Hon William


Roberts, Wyn (Conwy)
Walden, George


Robinson, Mark (N'port W)
Walker, Rt Hon P. (Wcester)


Roe, Mrs Marion
Wall, Sir Patrick


Rost, Peter
Wallace, James


Rowe, Andrew
Waller, Gary


Rumbold, Mrs Angela
Walters, Dennis


Ryder, Richard
Wardle, C. (Bexhill)


Sackville, Hon Thomas
Warren, Kenneth


Sainsbury, Hon Timothy
Watson, John


St. John-Stevas, Rt Hon N.
Watts, John


Sayeed, Jonathan
Wells, Bowen (Hertford)


Scott, Nicholas
Wells, John (Maidstone)


Shaw, Giles (Pudsey)
Wheeler, John


Shaw, Sir Michael (Scarb')
Whitney, Raymond


Shelton, William (Streatham)
Wolfson, Mark


Shepherd, Colin (Hereford)
Wood, Timothy


Shersby, Michael
Woodcock, Michael


Silvester, Fred
Wrigglesworth, Ian


Sims, Roger
Young, Sir George (Acton)


Skeet, T. H. H.



Smith, Tim (Beaconsfield)
Tellers for the Noes:


Soames, Hon Nicholas
Mr. Carol Mather and


Speed, Keith
Mr. Robert Boscawen.

Question accordingly negatived.

Main Question put and agreed to.

Resolved,
That this House takes note of European Community documents Nos. 6863/83 on future financing of the Community, 8822/83 on the Community structural funds, 5500/83 and 8552/83 on the supplementary measures scheme, 8385/83 the preliminary draft supplementary and amending budget No. 2 for 1983, the subsequent draft supplementary and amending budget No. 2 for 1983, the letter of amendment to the draft supplementary and amending budget No. 2 for 1983, and the Report by the Court of Auditors on financial management of Community activities (Official Journal C 287).

European Community Common Agricultural Policy

Mr. Speaker: There is a long list of hon. Members who wish to take part in the debate. Will hon. Members who wish to do so please leave the Chamber quickly and quietly?

The Minister of Agriculture, Fisheries and Food (Mr. Michael Jopling): I beg to move,
That this House takes note of European Community documents Nos. 8068/83 and 8823/83, communications from the Commission to the Council on the further development of the Common Agricultural Policy; 9596/83, introducing a tax on certain oils and fats; 9797/83, relating to the continuation of New Zealand butter imports into the United Kingdom under special conditions; 9797/83, Addendum 1, Commission report on the operation of arrangements for the importation of New Zealand butter during the years 1973–1983; 9988/83, on the market in products processed from fruit and vegetables; 9989/83, on the market in cereals; 9730/83 on the granting of aid for the use of butter and milk products; 9986/83 and 9986/83 Addendum 1, on the market in oils and fats; 9233/83, on the market in milk and milk products; 9691/83, on agricultural structures policy; 9686/83, 9686/83 Corrigendum 1 and 9686/83 Addendum 1, Report on the rules for calculating monetary compensatory amounts; and 10422/83, Report on the sheepmeat regime; and urges Her Majesty's Government to negotiate arrangements which will contain the cost of the Common Agricultural Policy, constrain surplus production, bear evenly on all Member States and take into account the interests of producers, consumers and food processors.
I welcome this opportunity for a debate on agricultural policy, especially on the Commission's proposals for adjusting the common agricultural policy following the decisions of the Heads of Government summit at Stuttgart in June.
My right hon. and learned Friend the Foreign and Commonwealth Secretary explained to the House on 14 November the Government's overall objectives in those negotiations, and earlier this evening he explained in more detail some of the budgetary aspects. We believe that a prime need is to secure more effective control of CAP expenditure. That strict financial guideline would be designed effectively to control agricultural spending in relation to the growth of Community revenue. My right hon. and learned Friend earlier dealt with that aspect, and I propose in this part of the evening to concentrate on the Commission's proposals on agriculture.
The fundamental problem is that over the years CAP prices have been set too high. Production has increased faster than consumption and the inevitable result has been that the consequent surpluses have become increasingly expensive to store and to dispose of.
The tragedy is that the Council of Ministers, over many years, decided to overrule the advice of my two predecessors — my right hon. Friend the Member for Worcester (Mr. Walker) and the right hon. Member for Lewisham, Deptford (Mr. Silkin) who both consistently argued for restrictive price policies. Surpluses of many products, including grains and milk products and some Mediterranean commodities, continue to increase.
In mid-November 8·5 million tonnes of grain were in Community public intervention stocks. At the same time, there was just over 1 million tonnes of skimmed milk powder and nearly 900,000 tonnes of butter in store. On the basis of present Community policies, the position must be expected to get worse.
Recently there have been some signs of a more realistic attitude. For example, the increases in farm prices agreed earlier this year were the lowest for many years, but that action has come too late to provide a solution. That was shown dramatically a few weeks ago when the Commission had to suspend certain advance payments so that the CAP could keep within the 1983 budget. Fundamental improvements are therefore now called for.
The most important and urgent problem on the CAP is the growing milk surplus and the financial burden that that represents. In 1983, the milk sector will cost about £3 billion, which represents almost one third of expenditure on the CAP and about one fifth of the total EC budget. There is now a general recognition of the problem and an acceptance that some really hard decisions must be taken.
Many hon. Members will have seen the statements by the England and Wales Milk Marketing Board and the National Farmers Union. I want to spend a few minutes commenting on the thinking of those two organisations, because that will take us to the very heart of the problem with which we are concerned.
The Milk Marketing Board argues for a policy based on a firm commitment to price restraint, with no increase in support prices for two or three years in all member states and with a small immediate reduction in the overall milk price. We, too, believe that action on the price level would be the best way of bringing production and consumption in the Community more into balance. Indeed, I have been saying that for several months.
But there is no evidence that member states as a whole will be ready, in Athens, to endorse a price policy sufficiently rigorous on its own to tackle the problems. As the Milk Marketing Board's document acknowledges, it would require more than a price freeze to bring the milk surplus under control over the next 12 months, let alone to produce any movement towards a reduction in that surplus.
It is worth noting that the price policy solution does not attract universal support from the various milk interests in the United Kingdom. The NFU's document is notably silent on price policy of the milk sector, and the Scottish milk producer interests, as well as those in Northern Ireland, are not advocating rigorous price policy as the way forward.
I wish briefly to discuss the Commission's idea for a tax on oils and fats, as that forms an integral part of the Milk Marketing Board's preferred solution. The Milk Marketing Board wants to see margarine taxed by an amount equivalent to the reduction in the butter price. In other words, it wants part of the solution to the butter problem to be a regressive tax on margarine. Let me say first that the impact of the Commission's proposal for a tax on oils and fats would not be limited to margarine; it would have wide-ranging effects in the food industries. It would also raise very serious international problems not only in the Community's relations with the United States, but in our trading relations with many developing countries.
The Government have firmly rejected the view that the problems of the dairy sector should be corrected by imposing additional burdens on producers and consumers of other products, and by transferring the problem of adjustment to third country trading partners, including, as in this case, many developing countries which are heavily dependent on the Community market. We have, therefore,

consistently opposed the introduction of an oils and fats tax. The NFU's approach is that a system of levies should be based on national standard quantities of production with each member state free to choose, within agreed criteria, the method by which to apply the levy to its own producers.
We should be clear precisely what that would mean. First, it implies that the levy reflecting the cost of increased milk production would be applied nationally—not to the individual producer who had expanded over the base quantity, but to all producers, irrespective of whether their own production had increased. Therefore, an individual producer would not be able to protect himself against the levy by adopting a strategy of producing at the threshold level related to his own enterprise. He would be liable to a charge which would be determined by the production of all other producers. He would not, of course, know until after the event what charge he would face. I am not sure that that solution would be attractive to many British milk producers.
The second point on the NFU approach is more fundamental. The levy based on a national standard quantity would amount to a national co-responsibility charge. The milk industry has always been opposed to the co-responsibility levy approach, and for good reasons.
It is fundamentally wrong to deal with the problems of the CAP by effectively taxing consumers, which is what co-responsibility levies amount to. As experience has shown, they open the door to exceptions which act against our national interest.
The NFU's ideas clearly imply the possibility of different arrangements in different member states. We could, for example, have effective levels of support in France or Italy different from those in the United Kingdom. All of us would be worried about an arrangement which might appear not to be operating even-handedly.
The England and Wales Milk Marketing Board rejects the Commission's proposal for supplementary levy. We also reject the Commission's proposal as it stands for a supplementary levy. It would not meet our requirement for action which is effective and fair across the Community.
One particular criticism relates to the base period. There are significant difficulties about using 1981, as many producers in the United Kingdom and throughout the Community have expanded production significantly since then, sometimes with Community financial support.

Mr. Nicholas Winterton: Some have come into the industry since then.

Mr. Jopling: Basing farm quotas on 1981 deliveries would therefore be unfair to many of them. Those difficulties would be greatly diminished if the base were derived from 1983 production with a reduction to bring the total quota down to the agreed level on a Community-wide basis.
Another problem concerns producer retailers and producer processors. We are worried that there might be scope for producers who do not sell all their milk to dairies to avoid paying the levy. That point has been firmly registered, and the Presidency of the Council of Ministers has now proposed that it should be covered. It would also be essential to provide for some flexibility in the implementation of a supplementary levy to allow scope for transferability and the handling of special problems. I have


in mind someone who has recently come into production, such as my hon. Friend the Member for Macclesfield (Mr. Winterton) mentioned.
However, given the serious objections to the alternatives, which I have explained, and given the need to find some means of tackling the milk problem effectively and quickly, we have to be prepared to consider the Commission's proposals for a supplementary levy to see whether what it has proposed, together with a restrictive price policy, can be turned into something which would be, if not our favoured solution, at least an acceptable second best. I understand that the three Scottish milk marketing boards have announced that their solution to the problem of the milk sector is to have a quota-based levy. There is a difference of opinion on these matters. However, the Commission's proposals, as they stand, will not do.

Mr. Robin Corbett: Liquid milk consumption in Britain could be increased by restoring supplies of milk to schoolchildren. Is the Minister saying that there are conditions under which he would recommend the acceptance of a co-responsibility levy?

Mr. Jopling: No. I was careful not to say that. I said that we should not proceed with the co-responsibility levy. With regard to school milk, I hope that local authorities will do their best to take up the relevant schemes.
The Commission has also proposed a special levy on the so-called intensive production of milk. I have firmly opposed this proposal. It would unjustifiably discriminate against a particular type of milk production. It would also be extremely difficult and costly to administer.
The Commission has also proposed the phasing out of the consumer butter subsidy on the grounds that it is not cost-effective. I much regret this short-sighted proposal. Butter is the main outlet for milk in the Community. Clearly it is unwise, in the circumstances of the milk market, to take measures which will reduce butter consumption. Consumers would find it difficult to understand that they should not secure any benefit from the surpluses which are available in painful quantities.
The Commission has also made proposals to increase the fat content of drinking milk. They would, however, only affect our semi-skimmed milk. Whole milk is sold here direct from the cow, and skimmed milk is also unaffected by the proposal. The overall effect on our drinking milk would therefore be very slight. We shall nevertheless be considering carefully the views of those affected by the proposals.
Still on milk products, though in our view not related to the post-Stuttgart negotiations, the Commission has submitted a report on New Zealand butter. It proposes import figures for the five years from 1984. The proposal is that imports should be fixed at 83,000 tonnes for 1984. Thereafter, they would be reduced annually by 2,000 tonnes a year over the five-year period. I have welcomed the Commission's proposal in so far as it provides a demonstration of the Community's commitment to New Zealand. I shall continue to press for an agreement that is fair to New Zealand and consistent with the Community's Dublin obligations not to deprive New Zealand of essential outlets.

Mr. David Harris: My right hon. Friend stressed the importance of doing something quickly in the

dairy sector. I am sure he is aware that, although farmers have moved for a change, they realise that they are facing a serious problem. Will my right hon. Friend accept that it would be fatal to bring about such a violent change in such a short term, as that would cause havoc in the dairy sector? Can he say a word about his thinking on the time scale over which the change might be introduced?

Mr. Jopling: I am conscious of the importance of that matter and I have already had discussions to try to see that there is not a massive and destructive move, whatever changes are made, whether through the price route, which we prefer, or through a supplementary levy.

Mr. Ralph Howell: Can my right hon. Friend be a little more explicit about what he means and which system he advocates? He is getting very close to suggesting that we should have an individual farm quota, and if so I congratulate him, but perhaps he could be a bit more specific. This is the only way in which we shall ever get this problem under control.
I have been battling on this subject for 10 years. I recommend that my right hon. Friend reads the Howell report of 4 May 1979. When he does, will he disregard the main findings and read the minority report in my name and the annex to it? A great deal of serious work has been clone on how to solve this problem. We studied how the Canadians and the Swiss had solved the problem, and the only answer is to have an individual farm quota. That will eventually get rid of the 2 million surplus cows in Europe.

Mr. Jopling: I am grateful to my hon. Friend for that advice. I shall have the Howell report produced and put on my desk at the earliest possible date. I think that I read it many years ago, but I shall need to refresh my memory. I am interested to know that my hon. Friend, with his enormous experience of these matters, believes so strongly that farm quotas are the way out of this difficulty.
On cereals, the principal problem is again one of increasing production against a background of static consumption. The cost of disposing of the resulting surpluses on third country markets reflects the wide gap between Community support prices and those on the world market. High cereals prices have also upset our arable-livestock balance. The Commission's proposals place a welcome emphasis on the need for price restraint by maintaining the guarantee threshold scheme for wheat, barley and maize and by introducing such arrangements for durum wheat. I also welcome its proposal to accelerate the narrowing of the gap between Community support prices for cereals and the prices received by producers in other major exporting countries.
The Commission also suggests that the new controls should be imposed on certain so-called cereals substitutes, notably maize gluten feed and citrus pulp. The tariffs on both of these are bound in the GATT. In our view, the simplest method of stabilising or reducing imports of these substitutes would be to bring cereals prices down to more realistic levels, which would reduce the incentive to import and would help the imbalance between the grain and the livestock sectors.
I know from the discussions that I have had recently with members of the United States Administration that they feel very strongly about this proposal. Clearly it would be to the advantage of no one if the Community and the United States were to become embroiled in a sterile row on the subject.
I apologise to the House for having to deal with the esoteric subject of monetary compensatory amounts. The Government do not regard their removal as in any sense a priority for the post-Stuttgart discussions. Nevertheless, we have to recognise that some member states see this as a very important matter.
It is already clear that the Commission's present proposals for the elimination of MCAs are not likely to form the basis of agreement. This is due primarily to strong German opposition. We shall judge any other proposals primarily according to whether they are consistent with the Government's objective of containing CAP expenditure. We have also made it clear that any new arrangements must take properly into account the special problems of countries with freely floating currencies such as our own.
So far, discussion in the post-Stuttgart framework has concentrated on the milk and cereals sector, on MCAs, and on the proposed oils and fats tax. However, economies are also possible and necessary in virtually all other sectors. I hope that an acceptable package will emerge at the European Council in a few days' time. If it does, we shall be looking for a commitment in the package that measures will also be taken to restrain expenditure in other sectors. That is particularly the case with Mediterranean products, on which in recent years expenditure has increased dramatically. The Commission has explained in general terms how it envisages economies being made in other sectors. It might help the House if I dealt briefly with the more significant of them for our farmers.

Mr. John Spence: I understood my right hon. Friend to say that there would be complete elimination of MCAs. I had understood that the negative MCAs would be retained. Is that incorrect?

Mr. Jopling: The aim of the Commission is to get rid of MCAs altogether. There is a great passion, particularly in France, to eliminate this gap, which the French believe gives the German farmers a large price advantage within the Community. The elimination of MCAs is being pressed by several countries, notably France.

Sir Peter Mills: Before my right hon. Friend leaves the subject of surpluses, will he confirm that there will be no special concessions to any country that is producing a surplus and that whatever agreement is finally reached will be fair to this country?

Mr. Jopling: Those were almost the words that I used in an earlier part of my speech. This is important, and it is one of the main reasons why we preferred the price discipline route for milk because it is, under those circumstances, almost impossible for there to be exemptions for certain states. I agree with what my hon. Friend says.

Rev. Ian Paisley: Will the right hon. Gentleman comment on the headline in The Irish Times, which said:
Howe admits super-levy unacceptable for Ireland.
The Foreign Secretary went on to say that there must be a concession for Ireland on milk. Will the right hon. Gentleman keep in mind the fact that Northern Ireland will need a similar concession if the South gets it?

Mr. Jopling: I have been aware for a long time of the views of the Irish Government on this matter, and Mr. Austin Deasy has lost no opportunity to tell me about his opposition to a super-levy.
In the beef sector expenditure is rising sharply. Over 80 per cent. of it stems from intervention or from export refunds. Accordingly, savings should in our view be achieved primarily in those areas. Therefore, we support in principle the Commission's ideas for a tougher policy on intervention purchasing. However, the Commission also proposes that the variable premium scheme should not be renewed after the end of the current marketing year. I believe that the scheme has served United Kingdom producers and consumers well. Its abolition would lead to a reduction in beef consumption and an increase in the Community's beef surplus, and therefore to an increase in FEOGA expenditure. I have made it clear to the Commission that we see no justification for the inclusion of this proposal in the measures designed to effect economies within the CAP.
The Commission has now reported on the operation of the sheepmeat regime and expanded on its proposals for changes. The United Kingdom is the Community's largest producer and consumer of sheepmeat. We believe that the regime should continue to take account of that fact. The regime should also operate without discrimination between member states. It should provide for the Community to honour its international obligations on imports, particularly as New Zealand is affected. We shall judge the Commission's ideas against those criteria.
I shall now deal briefly with structures, where the Commission has put forward proposals for a new policy. Although we need much more clarification, it is apparent that the proposed new policy would in many respects be similar to the present one. There is a continuing provision of investment aid to agricultural holdings, though there is a general move in favour of the smaller farm. The Commission proposes, for example, lower financial limits and a simplification of the development plan arrangements. There is a significant tightening of restrictions on aid to products in surplus. Hill livestock payments would continue, with enhanced rates of capital grants in the less favoured areas. New measures are proposed to promote farm forestry.
There is much work to be done before I am able to take a final view on these proposals, though I am concerned at the bias towards smaller farms and also have reservations about the proposals on promoting farm forestry.

Mr. Jim Spicer: My right hon. Friend is concerned about the bias towards small farms. Is he not concerned that in what he has been saying there is a total bias against the United Kingdom? Ninety-five per cent. of the Commission's proposals will hit the United Kingdom farmer much harder than any other farmer in the Community.

Mr. Jopling: It was with that in mind, and knowing that there is a much smaller proportion of small farmers in the United Kingdom than in the rest of the Community, that I said that I was concerned about the bias of the proposals towards small farms. Most importantly, the considerable suggested increase in the guidance section expenditure would be very difficult to justify.
I hope that I have covered most of the important points in the documents referred to us tonight by the Scrutiny


Committee. We are grateful to the members of the Committee for drawing our attention to these important matters. I hope that the House will support the motion.

Mr. Mark Hughes: It would be easy to follow the Minister in a general discussion of the proposals, or to go through the regulations and proposals seriatim and work out what the effect of this or that proposal might be. A vast number of highly specialised questions need to be asked. What is the right hon. Gentleman's view on individual farm quotas for the dairy industry? He fudged that. What is his precise view on the reduction in MCAs? What is his precise view on many other matters? I wish to be fair to the right hon. Gentleman, but he has not satisfied me and I suspect that he has not satisfied the House.
For example, there are the comments of the Royal Society for the Protection of Birds. That body is not insignificant. It has more supporters than the Tory or the Labour party, and more paid-up members, and therefore we should listen to it. The RSPB drew our attention to the proposals which reflect the Community's environmental policy—its policy on bird sanctuaries, bird life and the environment. The RSPB tells us that the proposals, or parts of them, would be helpful. The major difficulty lies in the Government's attitude.
The Government and the Community must ensure that there is a budget within FEOGA to fund measures to safeguard the environment. If necessary, the legal position of such payments must be clarified so that the good words in the draft regulations can be applied fully in Britain. When he replies, will the Minister assure the House that adequate safeguards in that specific area will be provided when we agree the proposals with the Community?
I want to refer to a document from the Cumbrian branch of the National Farmers Union. I am sure that the right hon. Gentleman will consider with care the comments of the NFU in Cumbria, which are headed:
We who are about to die salute you".
Is the Minister happy that his fellow members of the NFU Cumbrian branch regard the dairy proposals as the prospect of imminent death? The choice of 1981 as a base year for the dairy sector will militate against——

Mrs. Elaine Kellett-Bowman: That is exactly what my right hon. Friend said.

Mr. Hughes: The hon. Lady should listen. She should not be shrill. It was in the expectation that a member of the Cumbrian branch of the NFU would listen to the comments of that branch that I drew the Minister's attention to those comments. I trust that when the right hon. Gentleman moonlights to Cumbria it is known that he supports the position of the Cumbrian NFU on all the matters raised in the letter of which I expect that he too has had a copy.
The Opposition's wish to question the package does not rest on such details. In our view, the package does not measure up to the requirements of a fundamental review of a common agricultural policy that is faced with bankruptcy. It is tinkering at the margins rather than dealing with the fundamental problems, weaknesses and insufficiencies of the CAP. We are not concerned solely with the case of the RSPB, however important it may be, or even with the belief of the Cumbrian farmers that they are about to die.
The basis of the common agricultural policy is unsound and always has been. None of these proposals meets the need for reform. Notional unification and a notional unitary market supported by MCAs and all the other paraphernalia lead to a fictional form of price stability.
The Commission starts on the basis of protectionism. Paragraphs 1.6 and 1.7 of document 8823/83 state:
A cost-cutting exercise, conducted without regard to the social and economic consequences, would render no service to the development of the Community …The aim must therefore be to rationalize, not renationalize, the common agricultural policy. Only such an approach can give a good assurance of positive results.
Those of us who have been to the European assembly or other European organisations know that the Commission says that the CAP's basic structure is inviolate. The Opposition say that its basic structure should be violated massively. We must get away from using price as the principal method of supporting farmers' income.
If price is the key, the bigger the farmer the greater the price. To him that hath shall be given. That is what has happened. The defenders of the CAP say that its aim is to support small farmers and keep them in business, but that policy has failed. The drop-out from the land has been faster since the inception of the CAP than it was before. Its supporters cannot ask for protection to avoid submarine warfare.
I accept that between 1940 and 1944 self-sufficiency was a proper aim of an agricultural policy. Much of the Williams Act of 1947 was based on that policy. We were short of shipping or dollars. We based much of our agricultural policy and our deficiency payments on the idea of self-sufficiency.

Mr. Nicholas Baker: The hon. Gentleman is advocating violent and radical change of the CAP. Is he aware of the widely held view that such a change, to whatever system, would cause considerable damage to the farming community, which apparently does not worry the hon. Gentleman or his party, but also to the consumer and others who depend upon agriculture? What will he say to those people?

Mr. Hughes: To continue down the road of madness will not, in the end, support the farming community, the consumer or others involved in agriculture. To pursue madness in perpetuity does not make it sanity. We no longer have the restraint of shipping or dollars to compel us, as an island, to become self-sufficient. The pursuit of constantly increasing production is not of itself desirable.
We cannot deny our farmers the technical means to increase production. The CAP does not address itself to the two contradictory problems. There is a technical ability to increase production by up to 4 per cent. per annum but there is no corresponding increase in demand. There is improved production because of better breeding, improved varieties of grain and so on. We cannot deny the farmer the right to use that technical ability. At the same time, however, we can be supplied from elsewhere at significantly lower prices. That is the difficulty, and the CAP is found most lacking when it seeks to resolve that difficulty. It relies on the price of the end product as the principal way to achieve the transfer of wealth from the industrial to the agricultural sector. Everyone in the House, of whatever party, accepts that as a necessary function of a civilised society. No one in the House wishes to see agriculture made bankrupt. That is not our


objective. We want to see that transfer made efficiently and effectively. These proposals for the reform of the CAP do nothing towards achieving that objective.

Mr. William Ross: I am listening with great care to what the hon. Gentleman says about surpluses and steadily increasing production. That has troubled any thinking farmer for a long time. The hon. Gentleman will be aware that other countries, principally the United States, suffer from the same problem. It has overcome that difficulty by taking certain lands out of production. What measures would the hon. Gentleman's party accept for the United Kingdom?

Mr. Hughes: I am grateful for that intervention.
The United States has done other things. There is the curious butter-for-bauxite barter trade. It seems wrong, internationally, to get rid of United States' surplus to give subsidised butter to Jamaica in return for bauxite.
The Community has done that on a greater scale and it has resulted in the distortion of world trade. The alternative to taking land out of production within the Community is to make production in the Third world uneconomic by flogging subsidised surpluses. The Third world cannot support them.
If European sugar is dumped on the market, it is not European land that goes out of production but Third world land belonging to the people who can least afford it. That is what happens now. It is wrong, immoral and must be prevented. Nothing in the proposals does anything about that. The wealthy European sugar producers continue to break the bank of the Third world sugar producers. It does not make it more palatable if they do it through a levy on themselves rather than the taxpayer; it makes it less. We are on the wrong track with a policy that starts by "beggaring my neighbour", but that is what the export of sugar by the Community does. None of these proposals does anything about that.
We are considering a policy that continues to maintain protection so that the price within the Community is significantly higher than the price outside the Community. It is a policy whereby the consumer, irrespective of income, continues to bear the burden. It is a policy whereby the cost of the CAP bears most heavily on the people who are paid least in the Community. These proposals for reform do not even start. Not merely do they fail; they do not start. If hon. Members want me to go through paragraphs 2·13, 2·14, and so on, in document 8823, I will do so, but that is not where we fundamentally disagree.

Mr. Andrew Rowe (Mid-Kent): rose——

Mr. Hughes: When the budgetary pressure allowed this Government the opportunity to make a fundamental reform and press for that, they chose not to do so.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. John MacGregor): I am sure that the House is listening with great interest to the hon. Gentleman. His speech is full of general criticisms, but he owes it to the House, in considering what should be done, and to Britain's farmers, who must be listening with great consternation to what he is saying, to tell us his practical proposals.

Mr. Hughes: Certainly. On milk, we do not believe that the removal of the butter subsidy is in the interests of milk producers or of the consumers. We wholly reject the fats and oils taxes.

Mrs. Elaine Kellett-Bowman: rose——

Mr. Hughes: No, I shall not give way. I am trying to answer the Minister. There are parts of this fiddling at the margins on which we agree with the Government. We totaly agree with the Government in opposing the fats and oils taxes—and on butter. There are divisions of opinion among us, as there are among Conservative Members, about individual farm quotas, as opposed to national quotas on the super-levy. We have to prevent the continuous overproduction of milk. That is common ground. On cereals, we agree with the Commission proposals to come down to within 5 per cent. of the world price. There is no problem there. It is agreed. That is not the difficulty, but it is the wrong way, even when we have agreed it. The right way——

Mr. John Carlisle: rose——

Mr. Hughes: We are tampering at the margin. I have said it before, and I shall say it again and again. It is quite wrong to pretend that this is a real reform. It is not. It is a simple exercise in budgetary control, dressed up as something more.

The Secretary of State for Wales (Mr. Nicholas Edwards): The hon. Gentleman said that these proposals do not start. We should like to know where he starts.

Mr. Hughes: I start from the basis that the fundamental philosophical argument for the CAP is wrong, and that to charge it on the consumer via protection is the wrong way to support agriculture. Ultimately, it will fail. The Government do not help the farming community by loading on the consumer the protection of an overprotected farming lobby. The 2·5 per cent. cannot ride on the back of the consumer for ever. That is the difficulty that faces us.

Mr. John Carlisle: rose——

Mr. Hughes: No, I shall not give way.
If Community agriculture is to succeed…in expanding its exports and maintaining its share of world markets, it must increasingly accept the market disciplines to which other sectors of the Community's economy are subject.
Those are not my words. That is what is said in the document.
If hon. Members believe that the coal industry in Durham and the shipbuilding industry in the north-east, or anywhere else, would be in the position they are now if they had been treated in the way the farming industry has been treated, they live in a diffferent world. Agriculture has been overprotected, and in the end consumers throughout Europe will revolt. The farming industry must recognise that these proposals for the reform of the CAP wholly fail.

Mr. John Spence: If I understood the hon. Member for Durham (Mr. Hughes) correctly, he wants to turn the CAP on its head. That would be to the great detriment of British agriculture and the British consumer. I shall attempt to get the hon. Gentleman's support for that statement.
A Bill dealing with coal is now going through the House of Commons. In fact, it is now in Committee. The


argument being used by Conservative Members is that coal is one of the great natural resources of our country and the industry should therefore be supported. It is being supported in the Bill to the tune of about £2,500 million, and I am in favour of that. Coal is one of our great natural resources, it is under our own control, and it is an indigenous energy source. Agriculture, too, is under our control. It is an indigenous energy source, and I believe that in the interests of the Community as a whole it should be supported. I therefore ask for the hon. Gentleman's support in backing the prosperous agriculture of this country.
The hon. Gentleman developed the idea of turning the CAP on its head. I ask him and those who support him to consider an adaptation of the CAP, not its total reform, or, as he said, a fundamental and radical reform. Adaptation is a much better word. Any objective observer is bound to see that the CAP has benefited the consumer. It has been more than successful, and it is paying for that success.
Other hon. Members will deal with specific points. I want to lay down some markers on the general principles that are involved in the adaptation of the CAP. Agriculture is a long-term industry, much like the construction industry, with its major contracts, and the coal industry, with its long cycles of time. Any changes must be effected gradually over a reasonable period to give our fellow countrymen and farmers in Europe time to adapt. Sudden change is not suitable in the farming industry.
Our domestic agriculture requires a support system and a price structure. Farmers' incomes must be maintained. I am sure no hon. Member doubts that the maintenance of farm incomes is in the interests of the country and of those who are dependent on agriculture as a major industry.
Any change that is made to the common agricultural policy must be seen to be patently just and enforceable throughout the Community. Such a change will impinge upon the United Kingdom no more heavily than on any other country. We should not do anything to prevent young and new entrants into the industry. Although new entrants have not yet been mentioned, I should be very disappointed if that omission were ossified in its present form as a result of any action of the House.
I am sure that other hon. Members will deal in detail with the four or five methods proposed to deal with the milk problem. In view of the price restraint based on the 1983 figures, the 1981 figures would be unacceptable. I am glad to have the Minister's agreement on that. In my constituency several men would be made bankrupt overnight if 1981 figures were introduced. This must surely apply elsewhere in the country.
The next considerations are the super-levy, the co-responsibility levy and the national standard quantities. As they will be dealt with in detail I propose to say no more now.
I and my colleagues had a recent meeting in the House with dairy farmers who put forward certain proposals. Although I do not know the merit of the proposals, they were put forward by serious people and I put them to the Minister to see whether they could be considered and should be costed up.
What would be the effect on the surpluses if a herd diminution or slaughtering scheme were undertaken—not like the old scheme, which was loose and rather crude in its implementation, but one properly implemented and spread over a period of about 10 years so that people could

not get back in too quickly? Such a scheme could be coupled with price restraint based on 1983 prices. Would that be a runner in attempting to control surpluses?
The second point put to me at the meeting with dairy farmers concerned price restraint plus national standard quantities based on 1983 figures. Although such a proposal would take some working out, I wonder whether that, too, might be a runner.
What I have referred to in no way diminishes the problem which my right hon. Friend faces in the negotiations which he is conducting with member states of the Community, which have widely different aims, objectives and historical backgrounds. My right hon. Friend should note that the farmers realise that the common agriculture policy must be made cost-effective and are in a frame of mind to look at constructive proposals which conform to certain principles, four of which I have attempted to enunciate.
I end with a word of warning. If a scheme is pursued that is not acceptable throughout the industry, is there not a danger of an almost phenomenal growth in the producer-marketing organisations? This would result in the producer going straight to market with a wide gap between the farm gate price and the retail price. Would that not be to the detriment of the industry and of the United Kingdom structure?

Mr. Thomas Torney: Listening to the Minister making his speech, I hoped that he might have altered his views on the Common Market, particularly the common agricultural policy. However, as the speech continued, it became obvious to me that he was the same right hon. Gentleman as always. He is so completely immersed in supporting the beliefs of the Common Market that he can hear, see and feel no wrong in anything it does.
The Minister spoke at length about milk—a subject that has preoccupied the House in past weeks. Only a few weeks ago the House debated another aspect of the milk producing industry. I am sure that all hon. Members are concerned about the Minister's action, which will allow considerable quantities of foreign milk into the United Kingdom for sale in the supermarkets, with consequent falling sales on milk rounds and unemployment in the dairy and dairy supportive industries.
Dairy farmers, too, will be affected by the Ministers actions. Farmers may well wonder why they continually vote Tory when they can have little confidence in the Minister to fight against the Commission's proposals to introduce a super-levy.
The National Farmers Union said that the super-levy
would be higly damaging to the UK dairy fanner and ancillary industries and their work forces''.
The NFU continued:
They do not accept that the application of a super-levy on farm quotas is an appropriate way of dealing with milk surplus.
I hope that the Minister of Agriculture will show more consideration to dairy farmers than he did to dairy roundsmen a week ago.
Britain is self-supporting in liquid milk. Our farms are larger than the majority of French and German farms, many of which are worked on a part-time basis. I have visited Germany, so I can confirm that. The proposed levy will work in favour of French and German farmers while the United Kingdom farmer will have to pay. As a result, home-produced milk will become less competitive against foreign milk.
It is ludicrous that the United Kingdom should allow a system to continue that will bankrupt many dairy farmers. We have no surplus milk. However, the French, who produce a massive surplus, will be allowed—in effect, will be encouraged — by the proposals to continue producing and dumping their surplus milk in the United Kingdom.
This package of measures proposed by the Commission is not the long overdue basic reform of the CAP. It is nothing more than a package of emergency measures designed to curb agricultural expenditure and to raise revenue. The overall effect of the proposals is to base more of the burden of agricultural support on the shoulders of the consumer and the EC's international trading partners. As production levies work their way through to the consumer, there will be higher prices in the shops and the true level of agricultural support will be largely undiminished. Food should be produced to be eaten. We should not ]massive surpluses, paid for by the British taxpayer and consumer.
The proposed tax on oils and fats will hit severely the food manufacturing industry and increase costs for the consumer. It is estimated that the tax could add £75 million to the consumer's food bill. That will happen when industry is passing through the greatest crisis in history, creating mass unemployment. The increases in the price of food will cause untold hardship to sections of the community which are less able than many to bear it.
In the past the Commission's objective on cereals has been to align prices with those of its main competitors. That objective is no nearer attainment today than when it was first stated in the Commission's document, "Reflections on the Common Agricultural Policy." It is to be hoped that the Commission will now take firm steps towards the implementation of the reflections and that the Minister of Agriculture, Fisheries and Food will press it to do so.
The Commission's document refers to the possibility of imposing a levy on cereals to cover all or part of the cost of exports. As levies in other sectors—for example, sugar and milk—have been reflected in higher prices to the consumer, I am concerned at the prospect of the cereal levy being passed on to the consumer.
The absence of any proposals for reform of the sugar sector illustrates clearly that the Commission is inspired by budgetary considerations. The regime is ripe for reform. High levels of production, encouraged by high prices, have created massive surpluses in recent years. Community exports have disrupted world market prices and incensed third country producers, obliging the Community to implement stockpiling measures. The cost, although theoretically borne by the large growers and the sugar processors through levies, is reflected in the high prices paid by the consumer. If the Commission really wanted to rationalise the CAP, it would produce proposals for reform in the sugar sector. The Community should act now to re-establish the CAP on a rational basis.
The current package of measures, which is designed to shift the cost of the CAP away from the overworked Community budget, does not constitute the basis for a viable long-term solution. These proposals will merely enable the Commission to disguise the true cost of farm support. I hope that the Minister will review his own attitude towards the EC. I am not suggesting that he should

become an opponent of it. I realise that would be impossible. However, I ask him to view it more rationally and to understand that it has at least as many disadvantages as advantages for the United Kingdom. The Minister should attack those disadvantages in the same way as he often attacks and abuses those of us in the House who point them out to him.

Mr. Jim Spicer: We start these negotiations with the great plus that my right hon. Friend the Minister of Agriculture, Fisheries and Food is himself a practical farmer and has been involved in NFU policy over the years. He knows the people with whom he is dealing and knows when they are talking from their hearts and mean it, and when they are just trying it on. In this particular year, he knows quite well, as we all do, that, particularly in terms of the dairy industry, no one is trying it on.
I represent Dorset, West. Dorset and Cheshire would no doubt battle it out to see which was the better and more efficient milk producing county.

Mr. Nicholas Baker: Dorset.

Mr. Spicer: I am grateful to my hon. Friend.
We must consider in the negotiations the effect of the Commission's proposals on our dairy industry. I tried to find out what was the split allocated to the dairy industry of the bank overdraft for the whole of the farming industry, which now stands at £5 billion-plus. I cannot find out what the figure is, but I am sure that my right hon. Friend will know that a considerable percentage of that overdraft level has come about because the dairy industry over the past few years has been encouraged to expand by production incentives from the common agricultural policy. We should all have thought a little more about the monster that we were creating in terms of production.
Let us consider the Commission's proposals. Many of them have been rejected by my right hon. Friend. First, the base year of 1981 is completely unacceptable. Secondly, the price freeze is completely unacceptable as it will bear heavily on those who have come into production recently and who bear a large part of the heavy overdraft burden at the banks. There are possible exemptions and one can see them queuing up now. One does not have to listen very often to the farming news in the morning to hear the Irish pleading their case and saying, "We are special people and we need special treatment." I am certain that they will find a sympathetic ear from a Greek Presidency.

Mr. Nicholas Winterton: A weak Presidency.

Mr. Spicer: I would accept that view of the Greek Presidency as well.
Thirdly, there is the proposal for the super-levy. I asked my right hon. Friend earlier about the Commission's package of proposals and where they would bear most heavily. It is clear that we can no longer trust the Commission. It has only recently tried to cook the books on our budgetary contribution and our commissioners in Brussels condemned that in forthright terms. Every aspect of the proposals coming from the Commission will bear most heavily on the United Kingdom farming industry. That is completely unacceptable.
I wish that I were full of thoughts and solutions to pass on to my right hon. Friend in the negotiations. I was


scratching about in The Times—if one can scratch around in The Times—and I found a letter dated 15 November 1978 from Sir Henry Plumb, who at that time was president of the National Farmers Union. He was pointing out even at that stage the great discrepancy between self-sufficiency in terms of the United Kingdom and other member states of the Community. Is there not still a possibility that we could go a little further down that road and accept CAP support up to self-sufficiency at national levels and thereafter impose much greater burdens upon the national states if they go over the top? The difference between our 80 per cent. self-sufficiency and the 220 to 230 per cent. production levels which pertain in other member states in the Community is dramatic and comes about because of the explosion in their production figures from the mid-1970s onwards. Ours came much later. I put that forward, but perhaps it is far too late for us to move down that road.
I wish my right hon. Friend every success. He has many long days and nights ahead of him in these negotiations, but at the end of them, if the milk sector in particular suffers the disaster that might occur if the Commission's proposals go through as they are, the roll-on effect will not be held to only 2·5 or 3 per cent. of the population, but will affect the 9 per cent. of the population involved directly in agriculture and in the back-up to the agricultural community of this country. That could have a devastating effect on employment, not only for dairy farmers and milk roundsmen, but for people employed in factories, just at the time when we are beginning to see an expansion of production in farm implements and farm machinery.

Mr. Robert Maclennan: Agriculture is and must remain one of the most important industries in Britain for its employees, for all industries which are dependent upon its production, for the extent to which it supplies our domestic market, which has increased to 76 per cent., and for its potential as a source of exports, both of basic commodities and, more importantly, of processed foods.
It is important, therefore, to recognise that British agriculture has flourished under the CAP. That must never be lost from sight and criticisms of the operation of the CAP must be seen in that context. It is important to recognise that since the CAP was introduced to the United Kingdom agricultural incomes have not risen steadily—indeed, the reverse is true. It is also important to remember that proposed changes for common funding and price support must be considered against the background of relatively declining agricultural incomes and of increased indebtedness to the banks. During the past five years of the Tory Administration, indebtedness to the banks has more than doubled to more than £5 million.
When the Minister opened the debate he spoke in terms that would lead the House and those who read reports of the debate to think that the CAP was in a condition of crisis. He spoke of fundamental problems requiring fundamental solutions. I listened with great interest to try to discover not only the Minister's diagnosis of what was wrong, but his fundamental proposals for tackling the problems of surplus production and, as he sees it, excessive budgetary expenditure on the support of agricultural products. But one listened in vain, because the Minister offered no fundamental proposals. He criticised some detailed proposals from the European Community,

but offered not a scintilla of evidence that he grasped the nature of the problem or that he had any idea of the strategy required to tackle the problem.
Indeed, in at least one important respect the right hon. Gentleman misrepresented the position when he spoke of the excessive budgetary commitment to agricultural support. He missed the point that it must be judged by its cost-effectiveness and the extent to which it meets the purposes of the CAP as set out in the Treaty of Rome. Judged in those terms it cannot be said that excessive amounts are being spent globally on farming in the Community. It is about 0·5 per cent. of the GDP of Community countries. Agricultural support is no greater in Europe than it is in other industrialised countries, and he must know that. He is concerned with the Treasury's problems. He is not representing the interests of the farming industry, notwithstanding his personal understanding of the problems. He is the voice of the Chancellor of the Exchequer in the negotiations.
I shall not waste time by criticising the views of the official Opposition, because the hon. Member for City of Durham (Mr. Hughes), despite invitations from the Government Front Bench, gave no sign of what was their position about the fundamental problems of surplus production. His was a wholly negative speech.

Mr. George Foulkes: Will the hon. Gentleman give way?

Mr. Maclennan: The hon. Gentleman will have the opportunity to reply to the debate and can answer then any points that I make.

Mr. Jim Spicer: The SDP is chasing the farming vote.

Mr. Maclennan: The hon. Gentleman says from a sedentary position that my party is chasing the farming vote. My concern and that of my party and my colleagues in the alliance is for a prosperous agriculture industry which, given the right measures by the Government and by the Community, could rise to greater heights than it has under the stewardship of the present Minister and his predecessor.
Several fundamental questions have been raised by the Commission in its interesting papers on how to tackle the problem of surplus production. They were nor even alluded to by the Minister. Nothing was said about whether it would make sense to set common prices for more than one year in advance. The Minister did not propose a rolling programme of price setting each two years so as to give the farming community more certainty. Nothing has been said about whether the Government would countenance a change of policy regarding the giving of credit to importers of British food products, which is a practice carried on by the French, and which would assist considerably in disposing of some of our surplus production. It would be far better than paying export restitution.
More importantly, the Minister failed to grasp the underlying difficulties of the CAP, or to tell the House of his attitude or the Government's attitude towards them. Through the operation of the price support system. there has been a tendency in Europe to increase the capital intensity of production and to introduce high-cost agriculture, which has been reflected in high land values and which has not operated entirely to the benefit of the farming industry. It has certainly operated against the young people who wish to enter the industry. It is too much


to expect that the Minister would have reflected on such matters in the debate; but if he does not reflect on them at some stage, his claim to be concerned about the fundamental problems would be seen to be a sham.
I shall say something about how the fundamental problems should be tackled, but I cannot develop my ideas during what must be a short speech. The Minister appeared to say that the proper approach to the milk surplus was to take action on prices. That is what he and his predecessors did at previous price fixings; and, as he is beginning to recognise—although he will not admit it—that there is little prospect of Community-wide acceptance of a prudent pricing approach to milk, he is now backing into an acceptance of the super-levy proposed by the Commission, which he said was not, as it stands, acceptable to Britain. The Minister might have been more candid and said that he proposed to accept a modification of the Commission's proposal on the super-levy. There is no point in seeking to pull the wool over the eyes of the industry. The Minister is going to the negotiations to agree to this proposal in some form. We might as well have started with 1982–83 as the base year—

Mr. Jopling: I am not going. The Prime Minister is going.

Mr. Maclennan: I have no doubt that the Prime Minister will reflect the thinking of the Minister in whom she had sufficient confidence to appoint to his position. If the Minister says that he does not have responsibility for the agricultural proposals, the House will note that with interest. In a sense, he is underscoring my earlier point that as a spokesman for the industry he has effectively given way to pressures from the Treasury.
The super-levy proposal will be implemented and accepted. It is therefore important to ensure that it is not operated to the disadvantage of our domestic producers. It is likely to be the only possible solution to the problem. I believe that milk producers and farmers generally understand that quantitive restrictions of support are the only way in which we can hope to tackle this problem. It is widely recognised throughout the industry — the Minister is not prepared to voice that recognition; he will come in on the tail and not lead the vanguard—that price support must be operated on the basis of quantitive measures.
A stabilisation plan on cereal prices would be acceptable to the industry. If prudent pricing policies are to be pursued, they must be linked to production thresholds. The Minister did not, in my hearing, refer to one of the Commission's proposals which I would regard as considerably damaging—to tighten quality standards, which I believe would discriminate against the United Kingdom. The standards operated by the Community are linked not to market demand but to intervention. Malting barley and a number of other cereals that are important exports could be damaged if the Commission's suggestion were implemented.
It is a pleasure at least to be able to support the Minister in his opposition to the proposal to abolish the beef variable premium. It operates not only as a valuable protection for the producer but as a consumer subsidy.

Mrs. Kellett-Bowman: Will the hon. Gentleman give way? He has just misquoted the Minister.

Mr. Maclennan: I have not misquoted the Minister.
The Minister did not have much to say about the Commission's proposal to increase the suckler premium. That is not surprising as the Government are paying only 50 per cent. of the premium at this time. It would be of great advantage to herds and producers if the Government moved in that direction.
On sheepmeat, I agree with the Minister that the proposed limitation on the variable premium is unacceptable, certainly without altering the clawback mechanisms to secure the entry of our products into the European Community. The clawback on British exports to other Community countries should be limited to the same percentage of the guide price as that applying to the variable premium.
The Minister did not see fit to mention fruit and vegetables. Many people in that industry believe that the intervention rules operate against the interests of British domestic fruit producers by providing a back stop price which allows the French in particular to dispose of their large apple crop in this country at prices unfair to our domestic producers. For fruit and vegetables the alliance favours the Community market development fund proposals.
On fats and oils, I share the common view that the proposed tax is unacceptable and would be detrimental to our dairy industry.
The Commission's proposals on MCAs are a pious aspiration imbued with a certain unreality. For a number of years, the Commission has expressed the view that it would be desirable to eliminate the MCAs, but that could be done only by linking them to German values, which is clearly unacceptable at this time. I believe that the operation of MCAs has kept the CAP afloat over recent years when there have been divergent exchange rates.
It is a pity that the Minister did not take the opportunity to speak of the advantages to the farming community of Britain entering the European monetary system, which would eliminate a number of the uncertainties. There again, of course, the Minister is merely the poodle of the Chancellor.
On structures, the Minister made some rather alarming comments especially in respect of the impact of his policies in the marginal areas—the hills and uplands. He not only said that he did not favour the Commission's proposals, but went so far as to say that he would not favour an increase in guidance section spending within the Community which provides crucial assistance to the less favoured areas.

Mr. James Wallace: Does my hon. Friend agree that the Minister's failure to deal with these matters, combined with the Government's entirely negative attitude to an agricultural development programme for the Highlands and islands, will cause great alarm to farming communities there?

Mr. Maclennan: My hon. Friend is quite right. The National Farmers Union of Scotland has strongly and properly criticised the Government for three years' fiddling while the proposal lay on the table with the Commission and for their clear unwillingness to do anything about it. Money is available if the Government will only move, but they will not do so because it would have an impact on their budgetary objectives, which are not farming objectives.
Finally, on the longer-term needs of surplus disposal, it must be recognised that quantitative restrictions of price support offer the best hope of tackling this problem in a realistic way. Price restraint proposals put forward in the past did not adequately take account of the need to avoid damaging the incomes and savings—often in the form of assets and land values—of the farming population. For that reason, we must move to a system of quotas, tradable ultimately across the Community but initially within this country. I was delighted that the hon. Member for Norfolk, North (Mr. Howell) referred to that matter. He was right in what he said and I hope that there will be a bipartisan recognition of the need to move in that direction, even if the Minister is the last person to be converted to what the farming community perceive to be the proper direction.
If such quotas were introduced for milk, production need not be adversely affected bearing in mind the way in which our marketing system operates. Any farm level quota for cereals would have to be established on an acreage and representative yield basis.
Different commodities face different problems, which are not insuperable given the political will. There has been no consistency of purpose in the Conservative Administration's approach to agriculture. We have been told that the fundamental problem must be tackled. Last year we were told of the need for a standstill and the year before we were told of the need for a 10 per cent. increase in institutional prices. On each occasion the Minister has been out of step with his European colleagues and has failed to give a lead. The farming industry and the country need a lead, and we pray that it will be forthcoming.

Mr. Nicholas Winterton: I have never seen the hon. Member for Caithness and Sutherland (Mr. Maclennan) so worked up when delivering a speech. I consider it odd that he made a plea for bipartisanship in dealing with these problems, when his speech was anything but bipartisan. It was a most extraordinary contribution to the debate.
I congratulate my hon. Friends the Members for Dorset, West (Mr. Spicer) and for Ryedale (Mr. Spence), who have made positive contributions to the debate. I wish to be associated with much of what they said.
My hon. Friend the Member for Dorset, West said that the proposals were, in essence, unhelpful to the United Kingdom's farming industry. My right hon. Friend the Minister of Agriculture, Fisheries and Food, who was generous enough, when we were in opposition, to appoint me as his team member responsible for the dairy sector, will not be surprised if I direct my remarks to that sector.
My right hon. Friend said that the dairy sector of the CAP accounted for £3 billion, which is one third of the total CAP expenditure, and represents one fifth of the total expenditure of the European Community. We must put that fact into context, because the United Kingdom dairy industry is not producing the surpluses that we see mounting up in Europe. Britain is not self-sufficient in milk and dairy products, but since the Conservative party came to office, we have increased our dairy production from 70-plus per cent. to some 90 per cent. of our national requirements. Having spoken yesterday and today to several dairy farmers in my constituency—one of whom is a member of the council of the National Farmers Union—I am advised that we will be self-sufficient in milk

and dairy products by the end of next year. Britain is not responsible for the surpluses in the dairy sector The measures contained in these documents should not penalise the United Kingdom dairy farmer. That is an important factor which must be noted and accepted by the Minister.
The EC spends about 0·5 per cent. — that figure comes from the brief of the NFU—of its gross domestic product on central agricultural support. That figure is not out of line with the expenditure of other developed countries, all of which support agriculture in various ways. In support of our dairy industry, and to reduce the atmosphere of crisis which many think may emanate from the debate, I believe that the statistics to which I have referred put the issue into a better perspective.
I take the view of the NFU, which believes that certain principles should be rigidly respected in the current discussions and negotiations on the CAP. They include the maintenance of an effective system of agricultural support, the gradual introduction of changes where they are agreed to be necessary, the equitable application of any new policies throughout the Community, and the proper recognition of the importance of Community preference. If we are to be part of the club, let us have preference.
I must tell the hon. Member for Antrim, North (Rev. Ian Paisley) that it would be wrong to the Community to make an exception of the Republic of Ireland in any proposals that might emanate from the discussions and ultimate agreements. That would be unfair to Northern Ireland as well as to the remainder of the United Kingdom.
The debate is especially important. I am critical of my right hon. Friend the Minister because I wanted to hear exactly on what basis we were going into the final discussions. I agree that he did tell the House of certain matters. First, he said that he would not accept the EC proposal on oils and fat, and we warmly welcome that. I understood him to say also that we would not accept the super-levy. Opposition Members appeared to think that we would accept the super-levy, but we must not do so because it would be extremely damaging to the British dairy industry. It would also work against the best interests of the producer—the dairy farmer.
Like my hon. Friend the Member for Dorset, West, I make a plea for those farmers who have entered dairy farming during the past three or four years. They cannot be expected to pay back money on their investment on a reduced volume of milk. That would be quite unacceptable. I am delighted that my right hon. Friend said that the 1981 level was not acceptable to the Government and that he hoped — I am sure that the whole of the dairy industry hopes—that it would be based on the 1983 level of milk production, minus no percentage. I come from one of the areas which is a major milk producer. I am, of course, referring to the county of Cheshire, and Macclesfield in particular —[Interruption.] I shall not vie with Devon or Dorset about which is the most effective and efficient county in milk production. Cheshire is certainly one of the most efficient dairy producing areas of the United Kingdom. My dairy farmers are one of the most hard-working groups in the farming industry.

Mr. Jopling: I am listening intently to my hon. Friend. He says that a super-levy based on 1983 production should be minus no percentage to keep it at present Community production of 103 million tonnes. If we based it on that


level, which is about 6 million tonnes above the production threshold, how would my hon. Friend bring production down from that level to a manageable level?

Mr. Winterton: That is my right hon. Friend's duty and responsibility, not mine. I am here to represent not the French, German or Dutch dairy farmers, but the British dairy farmers, and I do so with all the strength that I can muster.

Mr. John Maxton: Will the hon. Gentleman give way?

Mr. Winterton: No, much less to someone from the centre of Glasgow. The hon. Gentleman might have gone to Eton, but that makes no difference. I am here to argue the case of the United Kingdom dairy industry. It is not self-sufficient and does not produce sufficient milk to meet Britain's needs. What is being done in the Common Market is quite another matter. That is why I support the NFU's request that the Government should adopt a national standard quantity as the basis for the problem facing the dairy sector in the EC. If we do not do that we go against the wishes of the NFU which has produced a brief rather late in the day, and I am critical of it for that.
I know my dairy farmers well. Never in almost 13 years of my being here have so many farmers gone to the trouble of telephoning me here in such a short period of time. They are deeply worried that what the Government might be talked into at Athens will be extremely damaging to our dairy industry. The result could be more imports of milk, in whatever guise. That would do irreparable damage to rural areas. As my right hon. Friend is aware, I feel deeply about that.
I have not dealt with doorstep deliveries. That subject was debated quite recently. On that occasion I registered my objection to what the Government are doing. I sincerely ask my right hon. Friend to think carefully about what is decided when my right hon. Friend the Prime Minister goes to the final negotiations. A great deal is at stake.
The documents have been rushed through because of a crisis. There is a crisis in the cash flow of the EC. We should not try to adopt policies in the short term to remove a temporary embarrassment. My hon. Friend the Member for Southend, East (Mr. Taylor) has campaigned vigorously against certain aspects of the CAP and the EC's budgetary policy. If we had acted sooner the problems that we are debating today would not be with us. One thing for which I shall not vote when the time comes is any policy which damages the United Kingdom dairy industry. It is extremely important to many parts of the country, and what adversely affects it will have a domino effect on many other industries.
I welcome the assurances relating to the variable beef premium. My right hon. Friend has taken a robust stand on that. I also welcome the additional assistance that is to be given to marginal areas. So far, only the hon. Member for City of Durham (Mr. Hughes) has mentioned that. That too, is an important matter. I hope that my right hon. Friend will take a message to the Prime Minister to the effect that there are hon. Members who will not tolerate a sell-out of United Kingdom dairy farming.

Miss Joan Maynard: Once again we are engaged in a debate on reforming the CAP. As in the past, it is likely to remain just talk. The Commission's proposals for reform are weak, but they demonstrate that even the Commission is worried about the huge cost of the CAP.
It is good to be self-sufficient in food but it is not good to be self-sufficient regardless of cost. More subsidy or public money is given to agriculture than to any publicly owned industry. Expenditure on the CAP in 1983 has increased markedly. It is expected to be 30 per cent. higher than it was in 1982. One could imagine what would happen if a worker asked for a 30 per cent. increase in income, and, in particular, if a farm worker asked for a 30 per cent. increase in his meagre wage. The farmers would hold up their hands in horror.
The Commission confirmed that the rate of growth of agricultural expenditure is now higher than the rate of increase in the Community's own resources. It considers, and not before time, that price guarantees cannot be unlimited. We are told that the essence of the Common Market is its belief in competition, but the Commission considers that the Community's external trade should be based on a combination of elements such as co-operation with its principal competitors to maintain world price levels. I thought that that was called price rigging. I cannot see that that has anything to do with competition.
If food prices were held down, that would increase consumption, which in turn would reduce stocks. Is it not criminal that in a world in which millions are starving some American farmers are being paid not to crop lands and in the EC we have huge stockpiles of food? There must be something wrong with a system that produces such a result. The cost of disposing of surpluses has gone up from 46 per cent. of expenditure in 1977 to 62 per cent. in 1982.
Surplus stores of food have increased enormously in the past four years. For instance, in 1978 there was a wheat surplus of 591,000 tonnes; in 1982 it was 5,292,000 tonnes. In 1978 there was a barley surplus of 140,000 tonnes; in 1982 it was 900,000 tonnes. In 1978, there was a butter surplus of 308,000 tonnes; in 1982 it was 548,000 tonnes. Storage, too, has increased in expense. In 1982, storage cost £1,125,000. In 1983 it cost £1,746,000, and it is estimated that in 1984 it will cost over £2 million.
We pay another price for the effects of the CAP apart from the monetary one—the environmental price. The CAP is changing the face of the English countryside, and usually for the worse. An example of this is straw burning, which to some extent arises because large areas of the countryside are now made over entirely to cereal farming. There used to be a system of mixed farming and the stock on the farm required the straw, but that is no longer the case in many instances.
The big cereal farmers are picking up some of the largest amounts from the CAP in subsidy. One of them described this as "a bit of a cake walk" and this was an accurate description from their point of view. Most cereal farmers are big farmers, and it follows therefore that the big farmers have benefited most from the CAP. The British cereal farmer is very efficient. In 10 years, the cereal acreage has increased by 7 per cent., while the increase in yield has gone up by 50 per cent.
The CAP has also encouraged farmers to cash in on new technology. There is nothing wrong with that except that


it has been done regardless of demand. The big cereal farmers are among the wealthiest farmers in this country. One 3,000-acre cereal farm in East Anglia now employs 13 or 14 men. At the end of the second world war it employed 85 farm workers. Technology, capital and energy have replaced labour on farms. The farm today is no longer the farm that we used to know. It is more like a factory, with a computer, and walkie-talkie sets for keeping in touch with the men.
Another aspect of modern farming which has been encouraged by the CAP is the amount of chemical fertilisers poured on to our land. It seems that we neither know nor care what the long-term effect will be, even though in some areas phosphates have been poured on to the land at such a rate that they have got into the water supply and water for babies under six months old has to be boiled.

Sir Peter Mills: Is the hon. Lady suggesting that British cereal farmers should return to the old methods of harvesting, and that coal miners should go back to the pick and shovel?

Miss Maynard: I do not know how the hon. Gentleman could interpret my remarks in that way. I should like British farmers to return to the rotation of crops. I do not like to see one cereal crop follow another. In the long term, we will pay for that. There is nothing as honest as the land. If we treat it honestly, it will treat us honestly, but we cannot afford to exploit it. We live off the top six inches of the land, and if we exploit it we will live to rue the day. What will be the effect of non-organic fertilisers finding their way into our bread and eventually into our stomachs? Many people are interested only in how much money they can earn in their lifetime, but there is a long-term price to be paid.
These farming methods are destroying our wild flowers. Wetlands have been drained and habitats destroyed. Hedgerows have been uprooted with the aid of CAP capital grants and bulldozed to ease the path of the combine harvesters.
Dairy and sheep farmers are doing well out of the CAP. The pig farmers are doing less well. Cheaper world food has been kept out, and so the consumer has lost out twice. He is paying higher prices for food, and he is paying the huge contribution to the CAP.
Farmers are quick to criticise when others receive subsidies, but they are ready and willing to receive them themselves. One of the aims of the CAP was to ensure a fair standard of living for the agricultural community. The farm workers are one of the most important ingredients in the agricultural community. Without their skill and devotion to duty no wealth would be created. They have not benefited from the huge amounts of money poured into the industry.

Mr. Nicholas Winterton: But farmers are farm workers.

Miss Maynard: Some, but by no means all.
Let us consider the standard of living of the average farmer and the average farm worker. The farm worker still collects more family income supplement than any other working person, and one cannot draw family income supplement unless one's income places one below the poverty line.
The CAP aimed to ensure reasonable consumer prices. It has failed to do so. Even the Conservative political

centre believes that it is essential to make the CAP less expensive to the taxpayer and the consumer, who are one and the same person.
The CAP is now absorbing two thirds of the £15 billion EC budget — a colossal amount. According to the Commission's own figures, EC grain and feeding stuff prices are still 100 per cent., meat, about 100 per cent., and cheese and butter 300 per cent. above world prices. The retail price of grain, cereals, meat, dairy produce and sugar is on average 20 per cent. higher than it would be if we were not a member of the Common Market. That is serious for consumers in this country, who are the majority of the population.
The CAP widens the gap between the rich and less-well-off farmer. Will France give way to help Great Britain in the next round of negotiations that we are discussing tonight? So far it has been unwilling to do so. There is strong opposition not just from France but throughout the EC to giving us further refunds, despite the runaway costs of the CAP which fall so unfairly en Great Britain.
As we know, the Community is near to bankruptcy. That is especially embarrassing in election year. French and British interests are opposed. The market which was to unite us divides us. The reforms that we have sought on many occasions are not forthcoming, and I doubt whether they will be forthcoming on this occasion. We should like to curb farm spending and end the national budgetary imbalance. That is the least that we need to achieve. The only solution to the problem for the British people is to leave the Common Market at the earliest opportunity.

Rev. Ian Paisley: It will come as no surprise to the House that I have always been suspicious of the Common Market. I am more suspicious tonight because of all nights we chose to discuss this matter is the night when for the first time the Ulster orchestra is visiting London. It is in Smith square with the famous Ulsterman James Galway playing that instrument which is well played by Ulstermen, the flute, and in the presence of that wonderful lady the Queen Mother. I would have preferred to represent the people of Ulster there tonight than be in the House, but it is my duty to be here to state the case for the farmers of Northern Ireland because of their position under these proposals.

Mr. William Ross: I assure the House that the people of Ulster are being properly represented at that gathering by my party leader.

Rev. Ian Paisley: In reply to the hon. Gentleman's suggestion that his party leader's is the only voice that speaks for Ulster, may I say that my vote in the European election was more than those of his two party colleagues. The ballot is the answer.
If the hon. Gentleman intervenes much more, he will not catch your eye, Mr. Deputy Speaker, and will make no speech. I shall therefore be the only person to speak for Northern Ireland in the House tonight. In Ulster, the dairy industry and its ancillary industries employ 3·5 per cent. of the working population. Agriculture is not a small problem for Ulster. We are talking about one part of our industry which employs 3·5 per cent. of those lucky enough to have jobs in Northern Ireland. The proposals for


a super-levy based on 1981 deliveries of milk would have cost the Northern Ireland milk industry £25 million out of a total income of £189 million this year.
That will strike a death knell for the dairy industry in Northern Ireland, and I associate myself with the remarks of those hon. Members who have spoken about the seriousness of the situation.
Northern Ireland farmers are opposed in principle to a supplementary levy based on 1981—or, indeed, on any other year. A much more constructive approach, they say, would be a policy of price restraint, coupled with financial inducements to encourage farmers to cease production for a substantial period. That is the evidence that has been put to the Agriculture Committee of the Northern Ireland Assembly by the farming community in the Province.
We see no point in doing away with the subsidy on butter and forcing people to eat margarine. Surely it would be more sensible to keep the price of butter down, thereby increasing consumption and reducing the cost of intervention procedures.
I shall say a brief word about cereals. The organisation of the cereals sector is of the utmost importance to our intensive livestock industry. This part of our industry in Northern Ireland employs 10,000 people and depends heavily on imported cereals with consequent high transport costs. The United Kingdom Government should argue strongly that intervention stocks should be available on equal terms to all grain deficient regions, where a need can be demonstrated. Surely we in Northern Ireland have better arguments than most people have to justify the transfer of intervention grain for storage here.
In 1982, the value of beef produced in Northern Ireland was more than £220 million. That is more than one third of the value of our total agriculture output. That part of our agriculture sustains a large number of jobs, not just in farming but in meat processing factories, cold storage, transport, distribution and marketing. About 70 per cent. of the beef that we produce is exported, mainly to Britain and the rest of the Community. We also have a valuable and increasing trade in non-member states. The industry is, therefore, of great importance and is of immense value in terms of our total economy.
Unfortunately for us, most of our beef is exported in carcase form, and a move towards more sophisticated products seems necessary. Such a move would mean the creation of more jobs in the industry, particularly in processing. For such a development, we need a strong stable basis at farm level.
The beef industry in Northern Ireland is a most important sector of our industry, and there is enormous potential for further development. As with milk production, the beef sector is based on our lush grasslands, which is the main raw material and is in abundant supply throughout the Province. When we joined the EC, the beef industry was expanding and developing. However, since 1974, for various reasons, the industry has suffered a crisis of confidence, and as a result there has been a steady decline in the beef herd. However, in the last couple of years EC aids introduced into Northern Ireland the calf premium scheme, and the extra payments under the suckler cow premium scheme have helped to restore confidence in beef farming and the first signs of a halt in

the decline in cow numbers are there to be seen. This trend is most encouraging. I hope that we shall see the rebuilding of our national herd towards the levels of a few years ago.
It is true that the Community produces more beef than it consumes, that production is rising faster than consumption and that the general world expansion in beef production will make it more difficult for the Community to market its surplus in other countries. We all recognise these facts and that the Commission feels that it must recommend some changes to the support measures to prevent any serious imbalance occurring in the beef market of the Community.
We also know, having read the documents, that the Commission stated:
A cost cutting exercise, conducted without regard to the social and economic consequences, would render no service to the development of the Community.
If these cuts and the Commission's proposals go ahead, they will lay the axe at the very root of one of the few businesses in Ulster that is progressing at present and promising the possibility of more jobs.
The Commission's proposal on beef will have very serious social and economic consequences for Northern Ireland not just now, but by placing the future potential for employment in our Province in serious jeopardy.
On the question of sheepmeat, Northern Ireland will be in great difficulty, for it is clear that the Commission wants to stop the advance payment of the annual ewe premium. Our producers currently get a proportion of the estimated premium at an early stage and the balance is paid at the end of the year when the final value of the premium is calculated. If this advance payment is stopped our producers' cash flow problems will be increased.
It must be remembered that most of our sheep farming is concentrated in the hills. These are the less favoured areas of our land where it is necessary to apply special measures to aid our farmers.
As a final word to the House, I wish to say that I am seriously alarmed at a report in The Irish Times:
The British Foreign Secretary Mr. Geoffrey Howe acknowledged here yesterday that the EEC milk super-levy proposal presented an 'unacceptable situation' for Ireland … A British official said last night that Mr. Howe's remarks were intended to be 'mildly helpful' to Ireland.
Its having been stated there would be no concessions there now seems to be a concession in mind.
If there is any concession and any imbalance as a result of that concession, it will tell against the interests of Northern Ireland agriculture which is the basis of our economy and the largest employer.
When Lord Mansfield came to the Agriculture Committee of the Assembly he said:
If as a result of the negotiations this or that class or race of producers obtain some kind of advantage we must see to it that the Northern Ireland fanner is not disadvantaged.
Will the Minister say whether the Government are sticking to that principle? Will the Government ensure that Northern Ireland does not get the rough end of the stick as the result of our membership of the EC?

Mr. William Ross: I am always grateful for the care which the Chair exercises in the protection of minorities in the House, not least today. The House has heard speeches from many parts of the United Kingdom, but I fear many of them have concentrated on milk. Indeed, the hon. Member for City of Durham (Mr. Hughes) said that he would not discuss the individual


categories of farm produce. Certain sections of farm production, therefore, have been barely touched upon and it might be wise to look at some of those sections.
I shall start with the question of support for sheepmeat as set out in the Explanatory Memorandum 10422/83. The proposals in that document seem to hit specifically at the small man or the person starting out in farming. There is no easier or cheaper way in which a young man can start livestock farming than by buying a few sheep. There are many hundreds, if not thousands, of young men who are now farming on a fairly large scale and who began in that way. However, we find that the one remaining entry point into farming that is open to anyone who lives in a rural area is to be hit if the recommendations in the memoranda are to be put into practice. It is proposed that those with fewer than 10 ewes will be treated less favourably than those with more than that number. I realise that there is an exception for Greece, where only five ewes are needed. In other parts of the documents we read that there are to be measures to help the small farmer and those farmers who I assume are currently below the standards which the Ministry of Agriculture, Fisheries and Food would consider viable.
When the Minister was opening the debate he did not say what constituted a small farm or what changes in criteria were to be applied under the proposed regulations. If the criteria are to be loosened to allow those who hitherto did not receive subsidy to receive it in future, the farming community and the House should be told what those changes will be and the effect that they will have.
The Commission is taking the view that advance payments of the annual premium within the sheepmeat regime should be curtailed. The payments are extremely useful to the farming community if only because they improve cash flow and save a certain amount of bank interest for many farmers. I am wondering whether the Government intend to oppose the change. I am also curious about the proposal to change the sheepmeat marketing year from April to January. Conditions in this country — we are the major producer — will raise difficulties for the producers of spring lamb. I hope that the Minister will comment on this when he replies.
There is the astonishing statement that an effort will be made to relate the annual premium to the average weight of lamb produced per ewe. If the premium were to be related to the average number of lambs produced per ewe, one could see some sense in that proposal. I cannot understand what is meant by the average weight of lamb. Does this proposal mean that a farmer who sells his lambs when they are relatively small will receive less for them than a farmer who sells when his lambs are larger, or is a sliding scale to be introduced? Will different attitudes be taken to lowland breeds as opposed to texel sheep, which produce three or four lambs? Will there be a special category of payment for hill sheep, for example? This is an important matter for producers of hill sheep, and before the debate concludes the Minister should tell us what the proposals really mean and how the Ministry understands them.
In document No. 9797/83 there is reference to the impact that the proposals will have on New Zealand's exports of butter to Britain. As someone who is fond of New Zealand and New Zealanders, I am worried that the quantity could be reduced. Here is another instance being brought to light of where the EEC is digging its hand ever deeper into the rule of this country. This example is hidden

in the regulations in such a way that most readers of them have not yet noticed it. Every time we come across such an instance we should make it plain to the House that there is a steady nibbling or constant erosion of the House and the rule of Britain.
The same document refers to the saving that can result by buying in a certain amount of New Zealand lamb, but that is an arm's length saving. By buying in we shall maintain the world price of lamb and thereby reduce EEC meat export credits.
Enough has been said about milk to let the Minister know exactly what the House and the farming community in general think of the proposals. I will not say more except to point out that milk production is a job that I have never liked—most right hon. and hon. Members will recall that I was once a farmer; indeed I still own land—because I do not like the propect of being tied seven days a week morning and night to a cow's tail as so many farmers are. For the average farmer, who is a working farmer, milk must be profitable or he will not slay at it, and, of course, at the present time, there is little else for him to produce profitably.

Mr. Nicholas Winterton: Are the hon. Gentleman's remarks of a few minutes ago about the size of farms as appropriate for dairy farms as for sheep farms? Does he not agree that we should have an explanation from the Minister as to what the British Government or the EC means by a small farm? Does he further agree that the exceptions and concessions that might come out of this agreement will all be unacceptable to the British dairy farmer, who is certainly the most efficient in the EC?

Mr. Ross: The hon. Gentleman makes a valid point. Many small dairy farms might be affected by this. No doubt the Minister when he comes to reply will reveal all. The House is waiting to hear just exactly what the position is.
By and large the proposals are unacceptable to British farming. There is no change here in the policy of the EC on farming. There is no change in the common agricultural policy. There are now so many areas in which the EC is more than self-sufficient—in other words, it is in surplus—that it is forced in the documents to call for an end to an open-ended commitment to agriculture. I cannot see how the common agricultural policy as it has operated until now can be reformed to the extent that I think is needed. There is a nibbling around at the edges to transfer some of the Community's commitments on agricultural imports to third countries. That will hit the poorer peoples of the world and some of the other traditional exporters such as Canada, which even yet sends us some produce, and New Zealand, which has special arrangements, and perhaps many others, who will be even less able to afford the attack that will be made on their national incomes. This will not help the consumer in this country because by restricting those imports we will force up our own prices.
Page 2 of document 10422/83 says that we need
to negotiate, within the framework of the voluntary restraint agreements, more restrictive import arrangements.
This is a series of protectionist measures. Protectionism by a nation such as ours, which lives by trading, must inherently be bad. This change in our traditional attitude has surely come about because of our membership of the EC. It cannot be denied that many people in this country and, indeed, many hon. Members foresaw long ago that higher production would result from the totally protected


market, especially with the quantity and quality of land and the climate in Europe, which is outstandingly good for the production of all temperate foodstuffs. The position in which we now find ourselves was inevitable, and no one can deny it.
We are now in the same position as the United States, Canada, Australia and New Zealand, although that is a much smaller country, which have enormous productive capacities and enormous surpluses. We are different in one vital respect in that they have low cost production. Our cost of production has become extremely high, which means that through the years the CAP has increased the cost of food and, therefore, lowered consumption—more food is eaten when it is cheap. During the drought years of 1976 and 1977, potatoes became scarce and reached a high price, and we all know what happened. Previously, people had picked two dozen spuds, cooked and eaten some of them, and chucked out the rest; then people picked out as many potatoes as they needed for their lunch, dinner or for fish and chips in the evening and did not waste any. We in western Europe live in an affluent society and when food is cheap, there is enormous waste. That waste disappears when food gets scarce. Much of the surplus results from that and from the fact that the population is not expanding as fast as it was.
No one can say that by encouraging more production, production will be cut. Farmers are not fools, and at the end of the day they realise faster than do most politicians that prices are reduced by increased competition. The CAP has closed all competition. Farmers are like most other people; they are like 999 out of 1,000—[Interruption.] The hon. Member for Birmingham, Erdington (Mr. Corbett) supported the members of his union who came out on strike for higher wages. Why does he blame farmers for doing the same? Farmers are not interested in surpluses because they know that surpluses are not good for markets or for incomes. They are interested in incomes.
The hon. Member for Caithness and Sutherland (Mr. Maclennan) said that agriculture had flourished since we joined the European Community, but the House should question how well farming has flourished in the EC since 1973. This afternoon I took the opportunity of digging out a few figures. No one knows better than the farming community and the Minister that it is difficult to determine the net income of farmers because of the nature of their work and the way in which they can spread their income from one year to another by deferring expenditure when money is tight. When a farmer has enough money to buy a tractor or a new machine, he buys it, but when he does not, he defers buying it until the money is available. According to Government figures, in 1973 farmers' incomes were about £858 million. Between 1973 and 1982 the figure fluctuated in percentage terms like a yo-yo. In cash terms, there was a steady increase up to 1982, when the figure reached £1,849 million. In real terms it fell from £858 million to £540 million. If we take 1973 incomes as being 100 per cent., by 1982 the figure was 62·9 per cent. If that is the picture of flourishing agriculture, I do not want to be around when it gets into the doldrums.
The position arose because the policy is basically wrong.
The policy has distorted agricultural production and costs, and it is getting no better. The longer we persist with the CAP, the deeper we get into the bog. Sensible people

know that this is not, and can never be described as, a serious effort to reform the CAP. This action is nibbling round the edges, just as a mouse nibbles round the cheese in a mouse trap. There is nothing here to give me confidence that a serious effort has been made either by Britain or by any other Community country to seek the root and branch changes that are needed for a common agricultural policy or, even better, for a national agricultural policy, which is vital to the welfare of Britain and especially to British farmers, who have done nothing but suffer under the common agricultural policy.

Mr. Deputy Speaker (Mr. Ernest Armstrong): Order. The Front Bench spokesmen hope to catch my eye at 10.50 pm, and several hon. Members are anxious to speak in the debate.

Mr. Robin Maxwell-Hyslop: There is general agreement in the House that no special case should be made for Eire, which has brought about the chronic excess of milk production by expanding its output during the past few years, when it was already clear that the Common Market would have to take steps to deal with a problem that was out of control. Similarly, Denmark deliberately raped the mackerel stocks of the south-west so as to generate existing use rights before the Community developed a realistic fisheries policy. We must not allow a country to benefit by becoming the Johnnie-come-lately of matters that are out of control.
It is not enough to talk, as the hon. Member for Caithness and Sutherland (Mr. Maclennan) did, of joining the European monetary system, unless he is prepared to say at what parity we should join. The implications of joining the European monetary system are completely different if we join at a high parity or if we join at a low parity. By simply recommending that we should join the EMS, without stating at which parity we should join, the hon. Gentleman hopes that the alliance can be all things to all men, as it generally tries to be.

Mr. Maclennan: rose——

Mr. Maxwell-Hyslop: If the hon. Gentleman wishes to tell the House at which parity he believes we should join the EMS, I shall give way to him. If he does not, I will not.

Mr. Maclennan: It would be advantageous to the farmers if we joined at the present parity.

Mr. Maxwell-Hyslop: Does the hon. Gentleman mean the present parity with the deutschmark? There is a deafening silence from the hon. Gentleman, I suspect because someone else wrote his speech and he does not know what it meant.
The most devastating problem in the Community—its consequences rub off on Britain—is the milk surplus, although in the United Kingdom we produce less milk than we use. However, the Milk Marketing Board has become confused. It is said that if the producer price of milk is reduced, output will be reduced. If that happens, either those producers who have a high interest loading because their production has been modernised or they have expanded on borrowed money, will be driven into bankruptcy, or individual producers will reduce their output. I do not believe that the latter will be the case.
What will be the effect on individual milk producers if the flat average price is reduced? They will increase their


output so that they can aspread their fixed costs over a large gallonage. The only way to break out of that cycle is to have a system whereby a negative yield is recorded for output above the quota. It would then not pay the producer to feed concentrate to produce the extra gallonage.
It has been suggested that there is some novelty or indecency in having national quotas. I draw the attention of the House in general and my right hon. Friend the Minister in particular—so that he can whisper into the ear of my right hon. Friend the Prime Minister before she goes abroad to the negotiations, so that this point is not forgotten—that this system is already accepted in the EEC's handling of textiles. There are not just EEC quotas, but national quotas, and there is no free trade between EEC members. If British importers use up their quota of a textile that is covered by a national quota, they cannot buy textiles that were unused in the German quota and import them into Britain. I do not debate whether that is wise or foolish, right or wrong, but it drives a coach and horses through the theory that there cannot be national quotas—we have them already.
Would a sensible policy be to try to check output in those countries which over-produce, or those which under-produce? Such a policy should try, of course, to check those countries which over-produce. This will not be done merely by having a low unit price for the whole of output. A part-time farmer in Germany will not be driven out of business by a low price because he does not depend on income from farming to stay in business. Such people are village postmen or something else.

Mr. Nicholas Winterton: A car worker.

Mr. Maxwell-Hyslop: A car worker or whatever. It is a fallacy to believe that output per producer is reduced by lowering the average price. That is why I believe that the EEC will need to have national quotas. That will mean that in the United Kingdom there will be an individual farm quota. That is the only way in which to achieve a fair return for the producer for the milk that the country needs, without using bankruptcy as an instrument.

Mr. Teddy Taylor: Is my hon. Friend confident of achieving the unanimous agreement of all member states to cut their milk production, but we would not cut ours?

Mr. Maxwell-Hyslop: I am never confident of achieving unanimous agreement anywhere, and certainly not in the EEC. We are in a position to say to those countries that if they do not agree they should try paying more for their milk surplus, as Britain has been doing for too many years. If we had a Government who removed Britain from the EEC, the Community would be faced with the question of how to pay the piper when Britain no longer paying—so the problem will not go away.
Finally, on the question whether it is possible to obtain unanimity now with 10 members in the EEC, I merely say that if it is difficult now, the difficulty will increase geometrically with the increase in membership to 12 when the olive oil pool is added to the problem of surpluses and when in addition to the battles between French and Italian wine producers there will be Spanish trucks to turn over, too.
When the Select Committee visited the EEC to investigate competition two or three years ago, officials

told us that the extra cost to the EEC when Spain and Portugal joined would be £2,000 million per year, so anyone who thinks that there are budgetary difficulties now has not seen the part of the overdraft that has not yet come out of the envelope.
Those are the realities and that is why, at the eleventh hour, we must get the CAP right, especially with regard to milk. If we do not do that now, we are unlikely to be able to do so once we have the additional problems of Spain and Portugal on our plate.

Mr. Robin Corbett: There is a well known saying, "If the cap fits, wear it." We are suggesting that neither the Minister nor the Prime Minister should do so.
I had hoped that it would be universally recognised by now that the CAP is an expensive folly, subsidising unwanted production at prices often well above 'world market rates. The United Kingdom consumer is twice robbed—first as a taxpayer to provide the subsidies and the costs of intervention, and, secondly, as a consumer in paying higher prices than necessary as a result of the subsidy system. If the saying, "The CAP must be reformed" were worth a £1 note every time it was uttered in the House the money would encircle the globe at least twice by now.
I hope that the Minister will deal with various specific points today. The common agricultural policy is not all common. It deals with some commodities but not others, although sensibly, especially in agriculture, the impact of decisions about one commodity should properly be taken into account in relation to others. The poultry sector is a case in point
Poultry meat and eggs account for about 11 per cent. of total United Kingdom agricultural output according to the Ministry and about 14 per cent. according to the British Poultry Federation. Both agree, however, that the annual turnover is about £2 billion. The poultry sector is a substantial customer of other agricultural sectors, buying cereals, proteins and equipment. It is also a major source of food supply and a major employer. Indeed, the number of jobs on the processing side is rising.
There is no intervention regime for poultry and the CAP review does not have to take account of that part of the industry. Yet the farm budget share for that sector is less than 1p in the pound. As a heavy user of cereals for feed in both meat and egg production, the poultry sector has to start work with the decisions already taken about cereals—in other words, the largest part of its costs is settled behind its back.
I suggest that the Minister should support the demand of the British Poultry Federation for a direct voice in the CAP reviews, as much in the interests of the industry as for the consumer. I hope that when my hon. Friend the Minister replies to the debate he will give me that assurance.
I accept the NFU's claim that the Commission's proposals discriminate against British lamb producers and consumers. I am alarmed that the NFU should give its support to the Commission's proposals to cut the level of New Zealand lamb imports. Historic ties of friendship exist between Britain and New Zealand, strengthened by two world wars. Pledges underlie such ties and I do not believe that they can be brushed aside.
Lamb and mutton is one of the rare commodities about which the CAP has not encouraged unwanted overproduction. The pre-war and immediate post-war availability of assured supplies of quality New Zealand lamb to our market are principally responsible for the maintenance of a large market and a public taste throughout the year for lamb. British producers have never provided more than a thin slice of total supplies.
The lamb trade dates back to 1882. Until the 1950s the United Kingdom was virtually the only market supplied by New Zealand. That fact shows the measure of interdependence. We must remember that that was a two-way trade. It suited New Zealand lamb producers as much as it suited successive United Kingdom Governments and consumers. Despite the distance involved, New Zealand lamb was available in Britain for 12 months every year. The New Zealand sheep industry is geared to exporting 90 per cent. of its production, which earns that country one third of its export earnings. The trade is critical.
When the EC sheepmeat regime began, New Zealand accepted an annual ceiling of 245,500 tonnes bone-in weight in return for a reduction in the tariff to 10 per cent. The voluntary restraint agreement was an important gesture by New Zealand. The Minister will recall that agreement.
New Zealand's share of United Kingdom lamb consumption fell from 55 per cent. in 1977 to 45 per cent. in 1982. The importance to the United Kingdom and its lamb producers is that the year-round availability of New Zealand lamb supplies helps to maintain domestic consumption in our off-season. That is no mean achievement. Once a market begins to slip because of seasonal or uneven supplies, it can be lost and replaced by another commodity. Our market needs New Zealand lamb supplies for reasons of its own as much as New Zealand producers have a need to supply it. New Zealand agencies have spent millions of pounds on helping to sustain and expand the general market for lamb and especially on promoting unfamiliar cuts.
If trade between EC member states and third countries is a two-way street, as I believe it to be, that involves accepting the special needs of outside trading partners such as New Zealand. I refer to this need in relation to dairy products. There are special difficulties in this sphere because of vast over-production within the Community. That was the position, and was foreseen to be so, in March 1975 when the Communities' Heads of Government accepted a declaration that:
These"—
the arrangements—
should not deprive New Zealand of outlets which are essential for it.
Irrespective of the party in office, our habit is that once a commitment is given in the name of a Government on behalf of the British people it lasts not only for the lifetime of the respective Parliament but in perpetuity unless an agreement is made to change it. No such agreement has been reached. I believe that the undertaking which the then British Government entered into, which has not been repudiated, remains. That undertaking, to which we put our name, is as valid now as it was then and I expect the Minister to take the lead in honouring that obligation.
I was amazed when the Minister, in opening the debate, said that he was minded to pursue a revised quota of

83,000 tonnes for New Zealand dairy products, falling by 2,000 tons a year over five years—[Interruption.] If the right hon. Gentleman is not going along with that, I shall gladly give way to him so that he can say so.

Mrs. Kellett-Bowman: For goodness sake get on with the speech.

Mr. Corbett: Although the Minister will not get off his Bench, I am pleased that he appears to be indicating that he will not put his name to that proposal.
New Zealand output is only 6 per cent. of total EC milk production. It would be unfair, unjust and unwise to try to solve the problem of over-production of milk within the Community at the expense of New Zealand producers and New Zealand itself. EC producers and their national Governments — and collectively through the Heads of Governments—should put their houses in order. Even if New Zealand supplies were further taxed, it would make no real or lasting contribution to solving the problem within the EC.
There is another serious argument, which I know the Minister will take on board. As a major world dairy producer, we need New Zealand's co-operation in the management of the small but specialised world butter market, of which New Zealand's share is a tiny, but important, 3 per cent. As the New Zealand Dairy Board has warned, without New Zealand having access to its traditional markets, the basis for that co-operation will be lost. I assure the House that those words were not written lightly.
Consumers have barely been mentioned in the debate. We tend to look at the problems of the CAP mainly from the viewpoint of the farmers and producers. The organisation, Consumers in the European Community Group, wants to see
a much fairer balance between the interests of farmers and consumers … this can only come about through a much more realistic level of support prices putting Europe's food needs first.
It continues, and I endorse this:
The Community cannot be allowed to continue paying money it hasn't got to encourage the production of more food that Europe doesn't need at prices consumers are increasingly unwilling to pay"—
it might have added, "and unable to pay because of the 12 million to 13 million unemployed people in the EEC, about one in four of them in Britain."—
and to increase exports which actually lose money.
That is well said. I hope that the Minister will make clear whether or not he accepts that view.
The claim in the brief which the National Farmers Union was kind enough to send us about
the very real achievement of the CAP
is ludicrous. At a cost of £10,000 a year for every one of its members, it would in any event be bought at too high a price. The brief lists the so-called achievements as
rapid improvement in productivity, assured food supplies, reasonable consumer prices".
It might have had the grace to acknowledge, as my hon. Friend the Member for Sheffield, Brightside (Miss Maynard) said, that those improvements in productivity have nothing to do with the CAP or our membership of the EC. They stem from the remarkable performance of the industry's falling full-time work force — people who have led the way in adapting to new techniques and tools in return for the pittance on which they are supposed to live.
The claim about reasonable food prices is just as hollow. The one family in seven forced on to welfare benefits by the Goverment will not make much of a Christmas dinner off those fine words in 24 days' time. Prices might be reasonable to people on average incomes, but to those on the poverty line they appear all too unreasonable.
The Minister, the NFU and farmers generally should show much more concern for the interests of the consumer, on whom the industry relies for its living. That is the imperative for real reform to end the vulgar over-spending and surpluses which the present mish mash of CAP produces.

Mr. Robert Jackson: Having failed to catch your eye in the earlier debate, Mr. Deputy Speaker, I shall be brief and will concentrate on the question of how to contain and reduce expenditure on agricultural guarantees. Of course, this is not the only perspective in which to see this matter. Along with our other interests, such as the control of public expenditure, we must bear in mind the hopes and fears of the millions of people who work on the land. That is the attitude of our Community partners, and it is realistic to recognise that fact in our negotiations with them.
The cause of expenditure on agricultural guarantees is the excess of supply over demand. It is as simple as that. If the supply of agricultural commodities in the Community were to be balanced with the demand, or if there were less supply than demand, the cost to the agricultural budget would be nil. How can we bring supply and demand into balance? That is the central and essential question.
There is no doubt that Conservative Members agree with my right hon. Friend the Minister that such a balance is best achieved by operating on prices. We would prefer to do it that way. It is the least bureaucratic solution, and it is also the least open to abuse. The signal would go directly to the producer. If the price reduction were sharp enough, there would be a reduction in supply and possibly an increase in demand. Moreover, such a system would do least damage to British farmers, whose resources should enable them to adjust relatively flexibly to price reductions.
In an ideal world we should address the economic and financial problems of European agriculture by reducing prices and we should address its social problems by direct income supports to the smallest producers. Unfortunately, we do not live in an ideal world. In agriculture, as in many other respects, the rational progress of mankind is held up by two great scourges—politics and science.
The politics are obvious. Bearing in mind the low elasticities of demand and supply in this area, the price cuts would have to be extremely large, and sustained for a long time, if they were to have the desired effect. That simply will not happen. Moreover, farmers know that that will not happen. If farmers know that price reductions will not be sustained, the rational course for them is to increase output and hold on against the day when the politicians flinch. That is what happened when the Community's tough policy broke down last year.
Just as important as political factors is the impact of science on modern agriculture. The high and rising levels of farm output in Europe and the United States are not simply a function of high prices. They are perhaps even

more a function of scientific and technological innovation, quite a large part of which happens irrespective of the level of price support. I suppose that we could kill off most scientific progress in agriculture if we reduced prices sharply enough. Short of that, the fact remains that the potential for increasing output in Europe, simply by the natural spread of existing best practice, is enormous.
Although we should rely on the price mechanism to the greatest possible extent, I am driven to conclude, like many other right hon. and hon. Members, that we must consider other ways of bringing supply and demand into better balance. That is why we must consider the limitation of supply by quotas. My right hon. Friend has fought a gallant rearguard action in the Council against the super levy. But if my argument is right, it follows that the line he has pursued cannot succeed in limiting the budgetary costs through the reduction of ouptut by means of price cuts. Therefore, with a heavy heart but in a spirit of realism, I urge him to shift his ground, at least with regard to the dairy sector. It might be possible to deal with other sectors by means of the price mechanism. But in the longer term, bearing in mind the accumulation of cereals in the United States and Europe, I wonder whether we shall not be driven to employ quotas and other methods in that sector too.
However, if we are to climb on board the super levy bandwagon, let me join those in the debate who have said that we must endeavour to get the Community to take full account of the relatively disadvantaged position of our producers at the moment when the whistle is blown. Let us limit, or prevent if we can, exemptions in favour of small producers. Let us resist any discrimination against intensive producers. Let us seek to reduce the rigidity of the quota system by making quotas as tradeable as possible within reasonable limits. Above all, let us negotiate for our producers a more favourable base year than the one proposed by the Commission.
Let there be quotas, but at the same time let us not think that quotas alone will do the trick. For quotas alone will not be able to effect the necessary savings to the budget. Let us assume that we succeed in fixing the base year at the point that we would prefer, the point least unfavourable to our producers—the level in 1983 minus 6 per cent. The fact is that at that level the Community would be 120 per cent. self sufficient at current levels of demand, and even if we were to accede to the Commission's proposal of a base year of 1981 plus 1 per cent. the Community would be about 115 per cent. self sufficient.
We must recognise that this excess of supply is the source of the problems of the European farm budget. Under the CAP system, these surpluses are disposed of by expensive subsidies either to increase domestic demand or for export. On the export market, the level of the subsidy required is determined by factors that are outside our control, such as the New Zealand and United States sales on world markets. Let me remind the House that in the United States dairy stocks are now running at 7 million tonnes which is 11 per cent. of America's annual production.
We must have quotas, but quotas are not enough. We must also have a tough prices policy that will, over time, bring the supply covered by the quota into a better balance with demand. Other methods will help, including cooperation with the Americans and the New Zealanders in managing world dairy markets. I agree with the hon.


Member for for Birmingham, Erdington (Mr. Corbett) on this. We must also look at the Commission's proposal on the level of fat content in milk: we should increase it on the Continent, where the fat content is lower than it is here. But let us be clear that the introduction of quotas cannot and must not be taken as a signal for lax price decisions within the quota.
Earlier today some hon. Members showed that they believe that the answer to the problems of the European budget could be found by reducing agricultural expenditure. That was the thrust of the very effective intervention by my hon. Friend the Member for Wells (Mr. Heathcoat-Amory). I hope that those who have followed my argument tonight will understand why this is not feasible. Wasteful spending on agricultural guarantees must be eliminated. This can be done over time if quotas are accompanied by strong price discipline.
But let us be under no illusion. The problem of farm expenditure and farm surpluses cannot and will not be eliminated, to use an evocative phrase, at a stroke. We cannot hope to solve the budget problem in that way. On that happy note, may I wish my right hon. Friend good luck in the gruell ing negotiations that lie ahead of him.

Mr. John Home Robertson: I declare an interest as a farmer. There are not many others on this side of the House who are farmers—only my right hon. Friend the Member for Cardiff, South and Penarth (Mr. Callaghan) as far as I know, and, come to that, not many of us in the Labour party represent rural constituencies. I want substantially more Labour Members of Parliament representing rural constituencies. I cringe when I hear people in the Labour party attacking the whole industry, as seems to happen from time to time, simply to pander to the daft, middle-class environmental lobbies about which we hear so much. I want to see production, industry and employment in rural Scotland. If we are to achieve that, we have to promote agriculture and the related industries throughout Scotland. They are inextricably linked with the social well-being of rural Scotland.

Mr. John Maxton: My hon. Friend supports the idea of subsidies for industry and help for all industries, not just the agricultural industries. He does not share the hypocrisy of Conservative Members. Every economic tenet in which they believe has been broken by every Conservative Member who has referred to subsidies this evening.

Mr. Home Robertson: My hon. Friend is quite right. I believe that agriculture should be supported, just as I believe that other industries should be supported. I do not believe in special pleading.
As manufacturing industry is essential to urban areas, so agriculture is essential to rural areas. In Scotland, 60,000 people are employed directly in agriculture and a further 150,000 are employed in related industries.
The Labour party deplores the power and privilege and the residues of the feudal system which still exists in rural areas. However, when we have swept all that away—as we will—and established a civilised and fair society throughout the United Kingdom, we shall still need a strong agriculture to provide food and to provide employment in rural areas.
I am one of the lonely hon. Members on the Opposition Benches who have consistently regarded ourselves as pro-European. The only thing that can counter multinational capitalism is multinational Socialism, and we will continue to campaign for it.
The intervention system of the CAP is beyond redemption. It has none of the virtues of Socialism, but it does not have the virtues of capitalism either. It is not even achieving its supposed aim of protecting little farmers. It has been exploited mercilessly by big agri-business. What is happening in some areas is obscene.
Some of my hon. Friends have referred to the monstrous expense of the CAP and the absurd accumulations of surplus stocks. It is distorting agriculture. It is encouraging more and more peoples in traditional livestock-rearing areas of Scotland to plough up their land and grow more and more feeding grains. Goodness only knows what those cereals will be fed to. In my part of the world there is a specialist mill which wants to buy oats to mill into porridge oats. Can it get local farmers to grow suitable oats? It has no chance. They are too busy growing big-yield feeding wheat and feeding barley. The farmers have lost interest in the market.

The Under-Secretary of State for Scotland (Mr. John MacKay): The hon. Gentleman has more than a few acres in the Borders. Can he explain to the House why he is not growing oats in order to help the mill?

Mr. Home Robertson: My reasons are exactly the same as those of any other farmer. If economic conditions encourage people to do daft things, one should not be surprised if they do them. The same could be said of malting barley and many other quality crops which could be grown throughout the United Kingdom. More and more feeding barley and wheat is being grown, and I am blessed if I know who is going to eat it. We shall be left with mountains of unsaleable feeding cereals.
The Government, with other Governments throughout the Community, should be seeking to restructure the common agricultural policy completely. I would rip it up and start again. We need two separate policies. On the one hand, we need a policy to deal with food and agriculture in Europe, and on the other hand we need a separate social-cum-regional policy to encourage employment in rural areas. They are in entirely different spheres and it is rather absurd to try to cover them both in the CAP. However, for the time being, given the tameness of the present Administration, we are stuck with the current daft CAP. Our objective should be to replace it, but we shall have to make the most of it for the time being.
If we must spend money on the CAP, let us try to spend it sensibly. Instead of dumping all these surplus feeding cereals abroad why not make it possible for livestock, pig and poultry farmers in this country to reap the benefit. It is absurd to have great intervention stores with hundreds of thousands of tonnes of feeding wheat in store at the taxpayers' expense sometimes only half a mile away from the poultry and pig farmers who cannot afford the feed that they need. The Government should be trying to find ways to ensure that our producers and consumers obtain the benefit of cheaper Scottish meat and Scottish produced feed, or British produced feed as we are still in the United Kingdom Parliament. That is not my fault. I look forward to the day when I can get in to a Scottish assembly which would be responsible for agriculture, but that is another issue.
I have received representations from the farmers in my constituency, as have other hon. Members, and from the National Farmers Union of Scotland. I am grateful to them for giving me their views on these proposals. The National Farmers Union of Scotland has grasped part of the intervention nettle system in respect of cereals. In its submission it says:
The union must also reflect the requirements of the livestock sector as a major customer for cereals. We therefore accept the need for new price relationships between cereals and other commodities".
So far, so good; it is learning. It goes on and spoils it:
but at the same time re-emphasise the absolute importance of maintaining the basic structure of the intervention system.
Why on earth should we? It seems to me that the system is irredeemable if we want to achieve a useful agriculture support system. Why cannot we think about some variation of the good, old-fashioned deficiency payments system? It worked pretty well and had the advantage of producing cheaper food for the consumers and providing an incentive to producers to produce quality crops. There is something to be said for that.
The trouble with so many things in this type of debate is that there is no such thing as a free market in food any more than there is a free market in anything else. In the complex economy of the late 20th century the only people who still believe in fairies and the free market are the Conservative party of Great Britain.

Mr. Maxton: Except in agriculture.

Mr. Home Robertson: My hon. Friend is right, but they are interfering with it in the wrong way. We are all for supporting industry, but why go about it this way in this one sector?
Our competitors are all manipulating their markets. Any significant switch from European-produced food to imported food would probably result in a significant increase in world prices. There is no joy in that for anyone.
If we are to be stuck with and tinker with the CAP intervention system, there must be no discrimination against Scottish producers. It might be superficially attractive to raise the standards for intervention buying of cereals, but geographic and climatic factors would mean that that would penalise cereal producers in the north of Britain and Scotland. It would give further encouragement and subsidies to the prairie farms of south-east England. There can be no justification for that.
The National Farmers Union of Scotland calls for the retention of the variable premiums for beef and sheep. The Minister of Agriculture said as much when he spoke at the beginning of the debate. I listened carefully to his defence of the variable premiums for beef and sheep. I agree that they are useful, practical and cost effective support mechanisms which help livestock producers and have the side effect of encouraging balanced farming. That is going out of the window in some pans of the country. At the same time, they promote consumption, as opposed to the stockpiling of food.
The variable premiums are almost alone among all the paraphernalia of the common agricultural policy. They aid the housewife and the farmer, and as such should be retained. As I said, I listened to what the Minister said, and I heard his fine words about the variable premiums. However, he did not say that he would go to the wall to ensure that they are retailed. Will he use his veto, if necessary? I hope that when he winds up he will say more on that subject.
I should be happy to talk about the need to sustain capital investment in agriculture, particularly in drainage—partly because it would help with job creation among contractors and other people in rural areas, but particularly because of the urgent need to replace much of the collapsing 19th century arterial and field drainage systems. Something needs to be done about them, because they will give rise to serious problems in millions of acres of land throughout the United Kingdom.
I do not want to waste time in this important debate. I therefore conclude by saying that we should all be determined to do away with the fundamental and scandalous distortions, surpluses and excessive prices of the CAP. In particular, we should seek to do away with the excesses of the intervention system. It is nearly Christmas, and I would love to give the Minister the benefit of the doubt, but I am afraid that in his speech today, and in his actions so far, he has not demonstrated that he is up to the job of getting this shambles properly reviewed—and properly replaced, because that is what is needed. I do not believe that this system will be done away with and something better put in its place under his stewardship. He rather reminds me of the Sorcerer's Apprentice. Instead of finding himself being swamped in more and more water, he will find himself swamped in vast tonnages of surplus milk and dairy products—barley, wheat, and all the rest. I do not believe that we can trust him, but we live in hope.

Mr. Terence Higgins: The House has heard several maiden speeches recently, and in one sense my speech tonight is also a maiden speech, because this is the first occasion on which I have had the courage to speak in an agriculture debate. I shall not, therefore, follow some of the matters that were raised earlier by hon. Members who know more about agriculture than I do.
However, I want to raise a number of important issues in the short time at my disposal. First, there is a clear link between this debate and the one that preceded it, in increasing the Community's own resources. I am bound to say that even if we reach an agreement that is satisfactory on the budget and the CAP, the case for increasing own resources at any rate has not been made so far. I was, therefore, glad to note that my right hon. Friend the Chancellor of the Exchequer did no more than say that if we were able to reach agreement on those two issues, he would consider, but no more than consider, an increase in own resources. The late lain Macleod used to say that one never had to worry too much if the Minister said that he intended to consider something, and that it was only when he said that he would do something that one had to worry.
I want to concentrate on one issue. In the Vote Office there is a series of Supplementary Estimates. One of them, class II, Vote 10, "Budget of the European Communities", is for a sum of more than £436 million. This additional provision is said to be sought because in response to further invitations from the Commission of the European Community under Article 10(2) of the Council Regulation 2891/77 and together with other member states
The Government agreed to bring forward payments of agricultural levies and duties collected under the Common Customs Tariff to ease the cash shortage of the Commission pending the adoption of their supplementary and amending budget for 1983.


This supplementary estimate raises some considerable questions. As I understand it, it is proposed that this vast amount of money covered by the supplementary estimate will be paid out of the contingency fund. The House would then be asked to reimburse the contingency fund by an adjustment of the consolidated fund.
When this matter was raised on 16 March 1982 the then Financial Secretary assured the House that the Government would keep the House informed on this kind of matter and give it every opportunity to control the Government in the matter of such expenditure. Because of the deplorable failure of the House to set up the departmentally-related select committees it has not been possible for the estimate to be scrutinised by the House nor for the House to take any evidence upon it. There is, therefore, some danger of the estimate coming before us for approval without that scrutiny having taken place.
Can the Minister therefore give the House an assurance that it is not the Government's intention to bring forward that estimate for approval until that has been done?
The Treasury on previous occasions has pointed out that there are very serious objections to the use of this very roundabout procedure. Apparently the Government do not feel that they can pay this amount direct from the consolidated fund. The Government appear to take the view that it would be improper. Accordingly, the Government pay the amount out of the contingency fund and subsequently reimburse the contingency fund. The contingency fund is designed for use in emergencies, but this is not an emergency. The Government are simply helping the cash flow of the European Community.
I am not at all clear why the House should respond, in the words of the Treasury note to this estimate, to the invitation of the Community to provide this money in advance. The House has not yet approved the transfer.
Since this is a considerable strain on the contingency fund, it might be relevant to ask to what extent there are any remaining amounts in the contingency fund and, if so, the precise amounts.
The legality of the proceedings has been questioned in previous reports to the Select Committee and this should give the House cause for concern. Before the estimate is approved, under the new procedures, if they are put back into operation, as most surely they ought to be, the House should have the opportunity of debating the matter and voting on it. On that occasion I hope there can be a full examination following closer examination in the select committees. Until that time comes, I hope I can have the kind of assurances from my right hon. Friend that I have asked for.
Grave concern has been expressed in the House about the general level of agricultural support through the EEC. I referred to some £436 million. A similar sum appears in the figures of the Chancellor of the Exchequer's autumn statement not for the year 1983–84 but for the year 1984–85 where it is pointed out that a sum greater than £400 million will be additional public expenditure as a contribution to the EEC and the agricultural intervention board.
It will not escape the notice of the House that that sum is not dissimilar to the amount implied in the Chancellor's autumn statement by which he might have to increase taxes next spring. The House should consider that matter very carefully when assessing priorities on public expenditure.
The Economist rightly pointed out a short time ago that in addition to all the expenditure through the EEC a very large sum is being spent in direct support to agriculture on a more domestic basis. The question of agricultural support needs to be examined much more closely. I find little argument in favour of working the two systems in parallel.
I therefore hope that my right hon. Friend will consider these points very carefully. We must have a better system of parliamentary control than the present one.

Mr. George Foulkes: It is appropriate that I have been called to speak immediately after the right hon. Member for Worthing (Mr. Higgins), who said that he made his maiden speech in an agriculture debate. I am making my maiden speech from the Opposition Dispatch Box. I saw the former Speaker, Lord Tonypandy, on television last week when he appeared in the television programme entitled "The Great Palace". He said that the Dispatch Boxes had some magical qualities about them——

Mr. John MacKay: The Opposition Dispatch Box will need those qualities tonight.

Mr. Foulkes: —that turned sows' ears of notes into a silk purse of a speech. I can only hope, like the Under-Secretary of State for Scotland, that the former Speaker was correct. Little did I think when I used to rant and rave from the Back Benches——

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mrs. Peggy Fenner): Exactly.

Mr. Foulkes: The hon. Lady knows me well. When I used to rant and rave from the Back Benches on Scottish rating or the invasion of Grenada, for example, I did not think that I would end up replying on behalf of the Opposition on the common agricultural policy. However, it is not an inappropriate subject.
I have listened to eloquent contributions about the great farming attributes of the counties of Dorset, Devon and Cheshire — the hon. Member for Macclesfield (Mr. Winterton) is no longer in his place—as well as East Lothian and Berwickshire. I represent a rural constituency and accordingly I represent many farming interests. Ayrshire potatoes and Ayrshire cattle are known throughout Britain if not throughout the world.

Rev. Ian Paisley: They are even known in Northern Ireland.

Mr. Foulkes: Yes, even in Northern Ireland.
I concur with my hon. Friend the Member for East Lothian (Mr. Home Robertson) in saying that the Opposition are not intent on bashing the farmers. That was not the intention of my hon. Friend the Member for City of Durham (Mr. Hughes), who has unfortunately left the Chamber. We are here to——

Mr. Tristan Garel-Jones: Bash the European Community.

Mr. Foulkes: No. Our purpose is to present a balanced view and make some critical comments.
It is appropriate that my hon. Friend the Member for City of Durham adopted an agricultural point of view when opening the debate on behalf of the Opposition and that I


shall take a wider perspective as one of the Opposition's European spokesmen. The right hon. Member for Old Bexley and Sidcup (Mr. Heath) said in the previous debate that agriculture must be placed in a much wider context in the European Community debate.
The House will have noted that the Opposition have not tabled an amendment to the motion. The Minister of State, Ministry of Agriculture, Fisheries and Food, who is to reply on behalf of the Government, and the Minister of Agriculture, Fisheries and Food, who introduced the motion, challenged my hon. Friend the Member for the City of Durham on the absence of an amendment. We have not tabled one because we do not disagree with many of the Government's criticisms of the Community documents. They have been expressed more forcefully by the Minister on previous occasions than his equivocation suggested this evening. We do not disagree with that criticism, but we have serious doubts about the Government's commitment to achieve some of their stated objectives.

Mr. Nicholas Baker: All my right hon. and hon. Friends are glad to see the hon. Gentleman in his elevated position. I asked the hon. Member for City of Durham (Mr. Hughes) to tell us precisely what he and his party were proposing and whether he accepted that any violent and radical change that was made suddenly would be bashing farming and the consumers and everyone else who we represent with an interest in agriculture.

Mr. Foulkes: We are not suggesting that there should be a sudden and violent change. The prime responsibility rests on the Government and the Minister to make suggestions, but I hope to make some positive suggestions in my few remarks.
There is no doubt that the CAP is out of control. I think that that would be the unanimous view of the House if it were not for the presence of the hon. Member for Caithness and Sutherland (Mr. Maclennan), who used to be my hon. Friend. He would be a dissenter because he is one of the Euro-fanatics. The commentators think that the EC is out of control and that, as The Guardian suggests, there is a "runaway agricultural budget." It said:
The EEC Commission committed itself last night to spending the last of its cash reserves to fund the runaway agricultural budget. The move dramatically deepened the sense of financial crisis in the Community, which has a strict legal limit on the amount of money it is allowed to spend"—
the own resources to which my hon. Friend the Member for Livingston (Mr. Cook) referred earlier. The EC budget is out of control.
We could understand all this money being spent on subsidies to agriculture if it meant lower prices for our consumers, but the opposite is the case. The prices to our consumers are in many cases two, three or four times higher than world prices. That is the irony. We are spending more money on agricultural support, we have higher prices and yet we have waste with surpluses at record levels. I am sorry that the hon. Member for Southend, East (Mr. Taylor) was not called to speak in either debate today. He was told in a written answer of 27 June of the extent of the surpluses, which are larger now in most commodities — wheat, barley, milk, beef and pigmeat—than they have been in recent years. We object to paying the money but not getting the lower prices.
The pattern of agriculture is being distorted by the common agricultural policy. The CAP favours rich

farmers — Sir Henry Plumb and some Conservative Members — in the south-east of England, not poor marginal farmers in the south-west of Scotland whom I represent. It favours the rich countries. Some of my hon. Friends have pointed out the way the changes will adversely affect the world.
I should like to now to deal with the Commission's proposals. It proposes not radical change but a tinkering with the CAP. The hon. Member for Ryedale (Mr. Spence) spoke about adaptation; the Commission talks about adaptation. But that is not what we want. What we want is reform.
The Minister has been quoted in the past as being critical of the super levy and as saying that it would institutionalise the disparities of production. I think that the Minister said that the super levy was unworkable. As my hon. Friend the Member for Livingston used to say, passing strange. The Minister was very much trimming his sails tonight. The French Minister of Agriculture would not appear before the National Assembly and trim his sails in the way that the British Minister of Agriculture did today.
The hon. Member for Wantage (Mr. Jackson) said that the Prime Minister should shift her ground on these negotiations. That is not the way to go into negotiations or to look after the British interest, about which the hon. Member for Macclesfield spoke. Hon. Members should not say to the Minister that he should shift his ground in the negotiations—[HON. MEMBERS: "He is not going."] The Prime Minister is taking on the responsibility as usual. I sometimes get the feeling that she does not need other members in her Cabinet; she can do the whole job herself.

Mr. Jackson: Does the hon. Gentleman agree that there is a problem in deciding what the British interest is in this matter? It is not adequate to talk about farming as being the supreme British interest. We must also take measures to contain the cost.

Mr. Foulkes: I understand that, but first I shall discuss the proposed oil and fat ban. The Minister of Agriculture says that he will oppose the ban, but I was not impressed by the firmness of his declaration.

Mrs. Kellett-Bowman: Will the hon. Gentleman give way?

Mr. Foulkes: No. I have very little time, and l must continue.
The oil and fat ban sums up some of the thinking in the Community, and sums up the nonsense that has been discussed in the European assembly, of which the hon. Member for Lancaster (Mrs. Kellett-Bowman) is a part. Although the market is already heavily over-supplied, the guaranteed price of butter has been increased so that producers produce more and consumers use less but turn instead to the cheaper substitute of margarine. However, rather than remedy the root cause of the problem—the high cost of butter—the Commission tried to penalitse the consumer——

Mrs. Kellett-Bowman: rose——

Mr. Foulkes: —who wishes to eat margarine, by using the oil and fat ban to increase margarine prices.

Mrs. Kellett-Bowman: Will the hon. Gentleman give way?

Mr. Foulkes: I have only six minutes left, and I do not have the time to give way again.

Mrs. Kellett-Bowman: rose——

Mr. Deputy Speaker (Mr. Paul Dean): Order. It is clear that the hon. Gentleman is not giving way.

Mr. Foulkes: I hope that when the Minister of State replies to the debate he will give firmer guarantees about the Commission's other proposal, the one on the sheepmeat regime, than did the Minister. We want an absolute guarantee that there will be no backsliding on that regime. As the chairman of the National Sheep Association said today in the Glasgow Herald:
The sheepmeat regime takes only one tenth of the support for milk.
Sheepmeat—I prefer to call it mutton or lamb—is not in over-supply. We should encourage the British farmer to produce more, not penalise him.
Hon. Members on both sides of the House have said that if we go ahead with some of the proposals there will be a hostile reaction from the United States. That was confirmed in a speech given at Edinburgh university last Friday by Mr. Lloyd Cutler, the former special counsel to President Carter. He talked about American relations with the Common Market, and he identified the common agricultural policy as a major area of future conflict between America and the Common Market. It is so serious that it might cause greater conflict than did steel exports to America, the pipeline controversy, or even the difficulties in Grenada. I hope that the Minister will ensure that the Prime Minister takes that into account when she discusses the matter in Athens.
My hon. Friend the Member for Newham, South (Mr. Spearing), who is Chairman of the Select Committee on European Legislation, reminded us that the Government must look after consumer interests. The Select Committee stated:
Consumers' organisations feel the proposals will do little or nothing to reduce surpluses, that the consumers are being asked to provide the money to prevent the limits on the EEC budget being exceeded, and that the only satisfactory solution would be to cut prices to the consumer.
I say, "Hear, hear", to that.
The food manufacturers were mentioned by the Select Committee as well. The Food Manufacturers Federation has written to me, and no doubt to other hon. Members, saying:
we have been campaigning for a long time for the CAP to be reformed and for its excessive costs to be reduced. One of our particular concerns is that the price support system operates in a way that destroys demand and ignores the added value that the food manufacturing industry confers on its raw materials with inevitable consequences for employment in the industry.
We have already seen the threat to the United Biscuits factory in Liverpool. We talk about the loss of jobs in farming, but what about jobs in the food manufacturing industry? That industry must pay a high cost for raw materials. The food manufacturers have made more criticisms about the proposals.
The scene is set for Athens. CAP reform has been discussed in the House since the 1960s. Conservative Members may say that the Labour party could and should have done something about the problem, and there is an element of truth in that, but there has never been a better time than now for any British Government to achieve a reform of the common agricultural policy. The Minister of Agriculture, Fisheries and Food, the Prime Minister and the Government representatives who will be at Athens have the best opportunity for reform that has ever existed. The Community is on the verge of bankruptcy. This


Parliament ultimately has a veto on any increase in resources. Therefore, we can demand CAP reform and ensure that our farmers', consuners' and taxpayers' interests are properly defended.
The Minister has made many promises. He has spoken of his strength of feeling on the super levy, the beef and sheepmeat premiums and the oil and fat tax. On 14 November, the Chancellor spoke of the importance of effective control of agricultural expenditure—we shall be watching for that — and about legally binding guidelines. That was a clear and unequivocal statement. We shall judge the success of the Athens meeting by comparing the results of that meeting with the statements and promises made by Ministers before it.
Sometimes I wonder about the motivation of Conservative Members. In my mischievous way, I had a glance through the Register of Members' Interests. There are no farming interests among Labour Members apart from my hon. Friend the Member for East Lothian and my right hon. Friend the Member for Cardiff, South and Penarth (Mr. Callaghan), but there are dozens of farmers among Conservatives, many of whom are here today.
Reference was made to the Minister as representing the interests of farming. The Minister of Agriculture, Fisheries and Food is here to represent not the interests of farmers but the interests of all the people — the taxpayers and the consumers. He should represent the national interest. On 13 October, the Home Secretary's brother, writing in the Financial Times, said:
Contrary to popular myth … the Cabinet is full of farmers, who unlike other businessmen, are not required to put their activities 'on ice'
The Cabinet must still represent those interests.
I am conscious of the fact that I must draw my remarks to a close. Like my hon. Friend the Member for East Lothian, we do not underestimate the importance of farming, but we cannot have an open-ended commitment to unlimited finance for the farmers. We must eliminate waste, and farming must become cost-effective throughout the Community. Prices must be reduced, or at the very least stabilised.

Sir Peter Mills: What about the coal miners?

Mr. Foulkes: The hon. Gentleman mentions the coal miners. The coal miners would love to have a common coal policy similar to the common agricultural policy, and they would like the subsidies that the farmers receive. The coal miners would like Community preference. If the hon. Gentleman compares the support for the farmers with the support for the industrial workers he will find that the farmers do very well indeed. [Interruption.] People such as the Under-Secretary of State for Scotland, the hon. Member for Edinburgh, South (Mr. Ancram), who favour European co-operation should be the most eager to reform the CAP because the waste, the cost of storage and the disposal of surpluses discredit the Community that he purports to support.
Reform is long overdue. There has never been a better time for it. We shall be watching how the Government defend the interests of the consumers and the taxpayers as well as the farmers. If they do not come back with the goods, they will have to face the music from us.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. John MacGregor): I begin by


welcoming the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) to the Front Bench. He clearly found the crutch of the Dispatch Box helpful. I remember when he and I worked closely together in Scotland on the "Scotland into Europe" committee — no doubt highly relevant experience for his present position.
On this occasion, the hon. Gentleman's contribution was relevant and he did not rant and rave, except towards the very end. I should perhaps remind him that a Bill now in Standing Committee will provide considerable subsidies for the coal industry.
We have had a most valuable debate at an opportune moment for the House to express its views on the developing negotiations. Many hon. Members have done that and done it well, sometimes expressing conflicting views as to the course that should be taken on individual items and thus illustrating some of the difficulties that face the Government.
My right hon. Friend the Minister concentrated on the major issues in his opening speech, and I shall do the same. If I cannot cover some the minor points raised by the Opposition, I hope that hon. Members will forgive me. My right hon. Friend made our position on the key issues very clear. One or two hon. Members tried to go into very detailed matters, but I am sure that the House will understand that as we are still negotiating it is not possible to be pinned down on the details of every item. No other member state would expect to negotiate on that basis. At the end of the day, one sometimes has to concede one or two aspects that one dislikes in order to reach agreement. Nevertheless, my right hon. Friend gave a clear indication of the position.
Before going into detail, I remind the House of the benefit to United Kingdom agriculture as well as to the consumer — I assure the House that we think of the consumer all the time—and to the economy of our 10 years in the Community from the agricultural standpoint. United Kingdom self-sufficiency has risen from 62 per cent. to 76 per cent. in 10 years. In the past five years alone, there has been a saving on our balance of payments rising to £1·25 billion per year. From being an importer of cereals we have moved to being an exporter. Moreover, in the past five years the increase in food prices has been appreciably less than that of all prices. All those points are clear proofs of the success that we have achieved in the Community.
We all recognise the difficulties that we now face, but we received no guidance at all from the hon. Member for City of Durham (Mr. Hughes) in his opening speech. He constantly called for fundamental reform, but what did the Labour Government do about the matter? Costs were very high then, just as they are now. If they had tackled the problem then, we should not be facing some of the present difficulties now that costs are soaring. I found nothing constructive in his speech apart from agreement on two aspects that the Government oppose as well. There was plenty of criticism, but not one constructive point.
The hon. Gentleman referred to the Cumbrian NFU brief, but the logic of his comments was death and burial for the British agriculture industry and for many of our rural areas. The hon. Gentleman referred to the NFU brief. My retort is to send the Cumbrian farmers a copy of his speech and they can reflect on what he said.
Many hon. Members have referred to the milk sector, which has high and rising milk surpluses. As Britain is not yet self-sufficient in dairy products, suggestions have been

made to the effect that we should have some exceptions and exemptions. The United Kingdom must play a full part in dealing with the dairy surpluses. My right hon. Friend the Minister said that the cost of the surpluses this year in the dairy sector alone will be about £3 billion. Last year they were £1·85 billion.
The United Kingdom is already 91 per cent. self-sufficient in butter fat and 131 per cent. self-sufficient in non-fat solids. I will have to refer the comments of my right hon. Friend the Member for Worthing (Mr. Higgins) to my right hon. Friends with the relevant responsibilities. However, he referred to an increase of £422 million in the intervention costs next year. Almost that entire sum is directed towards United Kingdom problems of skimmed milk and surplus butter. In United Kingdom intervention stocks, there are today 214,000 tonnes of skimmed milk powder, which is 752 days' supply, whereas there is only 233 days supply throughout the Community. We have 105,000 tonnes of butter, which is 130 days' supply. We have about 20 per cent. of the Community's intervention stock of skimmed milk powder and slightly under one-sixth of its butter stock.
If we argue across the board for exemptions for single situations, we face the danger that other member states that are well short of self-sufficiency in dairy and milk products would argue that they play a smaller part in dealing with the surplus. If we begin to pursue the course of exceptions to reflect the positon of individual nation states, there will be no end to the applications for exceptions. Such a policy would apply in many other spheres. The impression that I gained from the debate was that hon. Members did not wish Britain to agree to exemptions and special exceptions across the board with other member states.

Mr. Higgins: I hope that the Minister will not refer all the points I raised to his right hon. Friends, as some are related to his Department. Why is it necessary, by using the curious device of the contingency fund, to pay the money to the Community in advance rather than wait until the money is available in the consolidated fund?

Mr. MacGregor: My right hon. Friend is referring to accounting matters, about which I shall write to him. They are complicated, and I have to deal with many matters.
The position of the Southern Irish producers was referred to by the hon. Member for Antrim, North (Rev. Ian Paisley), and is relevant if the Government were to ask for exceptions for the United Kingdom.

Mr. Higgins: My hon. Friend is referring to the transfer of funds to the Community for agricultural purposes, and that is a matter for his Department. He should know the answer.

Mr. MacGregor: That is standard practice, and I shall write to my right hon. Friend. I vaguely recall the point. I have not had an opportunity to consider it tonight.
We do not accept that there could be any justification for allowing Irish producers to increase production and add to surpluses while producers elsewhere were being restricted. We have expressed, and will continue to express, our strong opposition to that. However, that fact is relevant when we ask for exceptions.
I wish to refer to some of the possible solutions to the milk problem, which my right hon. Friend covered in considerable detail. I had intended to draw attention to the many advantages of our general approach throughout the


negotiations in dealing with the dairy surplus through price restraint linked to the guaranteed threshold. I need not spell out those reasons, because that was done admirably in the succinct speech of my hon. Friend the Member for Wantage (Mr. Jackson).
My hon. Friend the Member for Macclesfield (Mr. Winterton) and other hon. Members raised the question of national standard quantities. There is not a generally agreed view on that within the farming community. For example, the Scottish NFU and the three Scottish Milk Marketing Boards are advocating the super levy on farm quota system.
There are many difficulties with national standard quantities. What will the individual farmer face? A national standard quantity applied in the United Kingdom would effectively mean a return to the co-responsibility levy. The excess of the national standard quantity in the United Kingdom would be levied on the farmers. There are two real problems with going down that road. First, the farmer would not know at the time that he was producing his milk what levy would be applied to him. We would not know by how much we had exceeded the national quantity, so the levy would be retrospective. The individual farmer, once he realised the implications of that, would regard it as unfair.
Secondly, the farmer will be levied not on the basis of by how much he had kept within his share of the quota, but on what others had done. Those farmers who did not exceed their milk production quota could subsequently be charged a levy because some of their neighbours had exceeded their production quotas. Not many farmers would regard that as fair.

Mr. Maxwell-Hyslop: I have not heard any Conservative Member recommend national standard quantities — only national quota and individual farm quota, which is something entirely different.

Mr. MacGregor: I was referring not to my hon. Friend's speech but to the speech of my hon. Friend the Member for Macclesfield, who did argue that case. Indeed, we all know that the NFU also argues that case.
There are other problems with a national standard quantity. Many of my hon. Friends and many farmers who have made representations to me are worried about the whole area of quotas, super levies or national standard quantities. Although we would apply them fairly in the United Kingdom, they are afraid that other countries would not do so. With the national standard quantity system, where each member state is allowed to apply it any way it chooses, there is no way of achieving uniformity of application, no way of achieving consistency and no way of checking what is happening. That is why we want a system that is seen to be fair across the Community and operating consistently. That is an important factor to bear in mind.
The NFU proposal is for pooling the costs of any excess above the national standard quantity. As I said, that goes back to the co-responsibility levy. Our experience of that is that it has pushed up support prices and consumer prices. The message to both farmers and consumers is that the danger in going down that road is that the system would collapse.
The present co-responsibility levy already has gaps and exceptions which disadvantage the United Kingdom. For

example, there is an exception for mountainous areas. Those who favour an increased levy want other changes so that it would operate more heavily on larger enterprises. With our large herd sizes, there is a real danger that our producers would end up paying far more levy. There are many difficulties with national standard quantity and increases in co-responsibility levy that have led us not to accept that as a proposal.
The hon. Member for Caithness and Sutherland (Mr. Maclennan) spoke about the super levy. My right hon. Friend made it clear that given the various objections to the alternatives, given the fact that there is not unanimity about dealing with the problems solely by price restraint, and given the need to find some way of tackling the milk problem effectively, we must be prepared to consider the commission's proposals for a supplementary levy. We must decide whether its proposals, which must be coupled to a restrictive price policy, could be turned into something that would be acceptable, even if second best.
My hon. Friend the Member for Ryedale (Mr. Spence) spoke about the need to ensure that the producer-processors' problem does not allow leakage — which would happen much more in other countries—and about the problems with the base year, and so on. We have taken those points on board in our approach towards the super levy.
The hon. Member for Antrim, North (Rev. Ian Paisley) referred to the butter subsidy, as did others. My right hon. Friend made it clear that we oppose phasing out that subsidy. We recognise the importance of the dairy industry to the economy of Northern Ireland. Some hon. Members referred to the equivalent of the dairy herd conversion scheme. There are problems with it. Such schemes have been extremely costly and have had little useful effect. Even if we build in strong conditions about producers not coming back into the industry, other difficulties remain. Some producers accept the subsidy when they intend to get out of that area anyway and as some producers accept payments for genuinely giving up, others add to their herds and expand production. On past experience, we feel that such schemes will not be one of the main items that will help us to deal with the problem.
The hon. Member for Caithness and Sutherland (Mr. Maclennan) referred to the problem of quality standards for exports of cereals. We have made our stance on that clear. There are several reasons why we believe that that is a major change of policy which would have to be discussed in the Council of Ministers and why we are unhappy about the proposals. The hon. Gentleman was wrong in regard to structures. My right hon. Friend referred to the extremely large increase which is being proposed by the Commission and which we do not think will be cost effective. That is why we are examining it closely. Hon. Members should consider the grant changes that were announced yesterday and other announcements that my right hon. Friend has made. It cannot be said that we are taking away benefits from the less favoured areas—quite the reverse.
The motion urges that we contain costs.

Mr. Maxwell-Hyslop: What about milk quotas?

Mr. MacGregor: That is one issue that must be discussed within the super levy. I apologise to my hon. Friend. There are many points to cover and I cannot deal with them all now.
The motion urges us to contain costs. We are facing up to that request in our policies in that we are emphasising the need for price restraint. We are trying hard to get written into Commission proposals the suggestion that price restraint should extend to items other than dairy produce and cereals. As my right hon. Friend said, it is important that we get that system extended to include Mediterranean products.
The motion refers to constraining surplus production. We have accepted that. We have urged price restraint with regard to surpluses. We reflected that in the grant changes that were announced yesterday. We are prepared to examine other Commission proposals, not all of which we like in detail.
The motion urges that changes should bear evenly on all member states. That is the most important part of the motion. It is firmly in our minds when we tackle these issues in the Community.

Mr. Nicholas Winterton: What about small farms?

Mr. Corbett: What about New Zealand?

Mr. MacGregor: I apologise to the House but I am not able to cover everything.
The motion refers to the interests of producers, consumers and food processors. The hon. Member for Carrick, Cumnock and Doon Valley dwelt on this matter. If he examines the points that my right hon. Friend made in his opening speech, he will see how we are endeavouring to get the balance right. We want to retain the variable beef premium because we believe that it strikes the right balance between consumers, producers and food processors. We oppose the restrictions on the import of cereal substitutes because it does not take into account the interests of some of our livestock producers and consumers.
Our stance on New Zealand reflects our anxiety to get the balance right. Our stance on the oils and fats tax, with which the House agrees, also demonstrates our concern for the consumer. I agree with what many hon. Members have said about the nonsensical way of dealing with rising expenditure and surpluses by asking for increased revenues through such things as oils and fats tax.
We have shown today that we are determined to play our full part in these negotiations to bring about the necessary changes that will bite on the surpluses and contain costs, and we are doing so in a way that is fair, as far as we can achieve that, to British producers and consumers.

Question put and agreed to.

Resolved,
That this House takes note of European Community documents Nos. 8068/83 and 8823/83, communications from the Commission to the Council on the further development of the Common Agricultural Policy; 9596/83, introducing a tax on certain oils and fats; 9797/83, relating to the continuation of New Zealand butter imports into the United Kingdom under special conditions; 9797/83, Addendum 1, Commission report on the operation of arrangements for the importation of New Zealand butter during the years 1973–1983; 9988/83, on the market in products processed from fruit and vegetables; 9989/83, on the market in cereals; 9730/83 on the granting of aid for the use of butter and milk products; 9986/83, and 9986/83 Addendum 1, on the market in oils and fats; 9233/83, on the market in milk and milk products; 9691/83, on agricultural structures Policy; 9686/83, 9686/83 Corrigendum 1 and 9686/83 Addendum 1, Report on the rules for calculating monetary compensatory amounts; and 10422/83, Report on the sheepmeat regime; and urges Her Majesty's Government to negotiate arrangements which will contain the cost of the Common Agricultural Policy, constrain surplus production, bear evenly on all Member States and take into account the interests of producers, consumers and food processors.

Isle of Man (Fishery Limits)

Motion made and Question proposed, That this House do now adjourn.—[Mr. Major.]

Mr. J. Enoch Powell: It is most unusual for an Adjournment debate on the same subject to take place twice in the same week. Nevertheless, it has certain advantages. It enables various aspects of a certain subject to be better ventilated, and one can, to some extent, in the second debate, benefit from what has been said in reply to the first. On Tuesday, considering the Isle of Man fisheries, the attention of the House was directed primarily to the importance of those fisheries for certain English and Scottish fisheries. Tonight I speak from the point of view of the fisheries of Northern Ireland, and especially County Down.
How important those waters are for them can be illustrated by the fact that, taking the prawn fishery, which is the most valuable single fishery, it is estimated that the waters to which this debate relates represent about 30 per cent. of the landings in Kilkeel, and up to 60 or 70 per cent. of the landings in Arglass. Putting it another way, and more generally, 50 per cent. of the Kilkeel fleet and 75 per cent. of the Portavogie fleet depend for their livelihood upon those waters.
The waters in question are those which a recent report of the Manx Government has suggested should be taken over and added to the fishery control area of the Isle of Man authorities. That report appeared in May, and the Isle of Man Examiner, looking forward on 30 September to the Home Secretary's recent visit, under the title "November Visitor", said:
Extension of our fishery limits to 12 miles has been agreed in principle"—
that means, with Her Majesty's Government or the Home Secretary—
but implementation is a complex matter which we alone are unlikely to be able to advance.
Indeed, it is impossible for them to "advance" it alone.
That was what the fishermen of Northern Ireland were hearing in September. Today the Home Secretary answered a question of mine. I asked
what consideration the Manx authorities have offered Her Majesty's Government in return for any agreement to extend the Manx fishery control limits in the way suggested?
He replied:
Discussions are not yet sufficiently advanced for such a possibility to be considered.
However, our anxieties are far from allayed by being told that discussions are in progress and consideration is going on; for we have been gravely alarmed by the type of assurance that we have been receiving. For example, the Minister of State, Home Office, on 16 November wrote to me saying:
I can assure you that Ministers would not countenance the introduction of any substantive change … without widespread consultation among the relevant UK interests.
When Ministers get to writing to interested parties to the effect that they will not countenance substantive change without consultation among the relevant interests, one knows that something is afoot behind the scenes.
Nothing has been said so far to allay our anxiety. Indeed, the effort that was made by the Under-Secretary in the debate on Tuesday proved counter-productive. He

brought back, as good news from the visit of the Home Secretary to the Isle of Man, the fact that the Isle of Man authorities
gave an assurance that, if any new measure were agreed, they would not attempt to discriminate." [Official Report, 29 November 1983; Vol 49, c. 865.]
That made us more suspicious than ever, because what is the point of the Isle of Man wanting to take over control of a zone nine miles wide—between the three and the 12 mile-limits—if it is not to give the Isle of Man any advantage over the present position? There is only one answer that the fishermen of Northern Ireland would return, although they would mean no disrespect to the Under-Secretary of State for his opinion. They would say, "We do not believe it."
We have indeed a reason for disbelieving that proposition: it is fact that during the past three years the licensing system for these waters has been applied to British vessels through the agency of the Isle of Man authorities. That is to say that although the licensing powers are those of the United Kingdom Ministers, the licences are issued by the Manx authorities as their agents. That is politically inept and unfair, and also unlawful. When I pronounce the word "unlawful", my attention will be directed to the Sea Fish (Conservation) Act 1967 as amended by section 4(11) of the Fishery Limits Act 1976, which runs as follows:
The Ministers may make arrangements for any of their licensing powers under this section … to be exercised by other persons on their behalf.
I do not believe that when Parliament writes into a statute that Ministers of the Crown in the United Kingdom can use "other persons" as their agents the "other persons" would include the authorities of countries outside the United Kingdom. If that is what the Minister might, by any chance, be intending to say, he is arguing that the licensing could be entrusted to President Reagan, and still that could be within the contemplation of Parliament.
The natural and constitutional meaning of subsection (11) is that it refers to other persons within the realm and potentially under the control of Her Majesty's Ministers, that it means bodies, boards and so on within the realm, over which Ministers can, in the last resort, exercise authority. It does not mean that Ministers can transfer outside the realm powers conferred on them by an Act of Parliament.
The fact that this has been attempted in the past three years is not only a constitutional and legal outrage. The fishermen have been very wise to protect themselves by returning the Isle of Man licences and insisting on getting licences from their own Ministers in the United Kingdom. It is also extraordinarily inept for the Fisheries Department in Northern Ireland to use as a licensing authority, in the very waters which are concerned, authorities which are responsible to those in competition with fishermen from the United Kingdom and whose encroachment and incursion are threatened by the proposals under examination.
The Home Secretary is in a special position in this matter. When he went to the Isle of Man to discuss with the Isle of Man authorities their preposterous suggestion that their fishery control limits should be extended from three to 12 miles or to the median line from the Isle of Man coasts, he was in a dual if not a paradoxical position. Constitutionally the Isle of Man is a possession of the Crown of the United Kingdom; but it is not part of the United Kingdom, and in the Government of the Isle of


Man the Crown is advised by the Privy Council through the mouth of, as it so happens, the Home Secretary, though the Home Secretary is only in a position to offer that advice to the Crown in respect of the affairs of the Isle of Man because, as Home Secretary and a member of the Administration, he enjoys the support and confidence of this House, this Parliament of the United Kingdom.
There is an anomaly, a duality, in the constitutional position. The Home Secretary is in the absurd position of being required, in one of his aspects, to consult the interests of the Isle of Man, and yet in his other capacity to be responsible for the interests of the United Kingdom.
One thing is in my view certain; that is that no such arrangement could be made or agreed without the authority of this House. The fishery waters of the United Kingdom have been declared by the House in the Fishery Limits Act 1976. They are our waters. They are United Kingdom waters. I will not for this purpose enter into the question whether those waters do, as I believe they do, wash the coasts of the Isle of Man itself; but beyond all dispute, outside the three-mile territorial waters of the Isle of Man these waters are our sovereign fishery waters and have been declared to be such by this Parliament.
I am here to say that the Secretary of State and the Government have no power to give away the property of the United Kingdom to a territory outside the United Kingdom unless they can persuade the House expressly to authorise them to do so. It will need a good deal to persuade the House, I believe; it will certainly need a good deal to persuade the people and fishermen of Northern Ireland of the expediency of doing so.
I have this warning to give to the Home Secretary and to the Government. If they tamper with the present fishery limits which are conceded to the Isle of Man, the three-mile limit, they will start something which will not finish until the anomalous constitutional position of the Isle of Man has been dealt with altogether.
This House is not particularly enamoured of tax havens maintained at the United Kingdom's expense. A constitutional anomaly of historic proportions is one thing. It can be tolerated provided that it is not a nuisance; but if it is to be the occasion of the interests of the people represented in this House being transferred and surrendered to those who are not represented in this House, then that anomaly becomes indefensible. Sooner of later the Isle of Man will find itself embark upon a course the result of which will be that the island is amalgamated into the United Kingdom and will have the privilege of returning half a Member, according to my calculations, to sit in this House.
I am not jesting; nor are the people whose interests are concerned jesting; nor are the people who have gained their livelihoods in waters which are the sovereign waters of the United Kingdom to which they have hitherto had the right of access as British citizens. They will not allow those rights and that livelihood to be taken away from them, to be transferred outwith this realm, without serious consequences for those who were the origin of such a thing happening.
Let not the people of the Isle of Man, who have been left to enjoy the advantages of their double status unmolested for so long, carry their privilege too far or tempt the resentment of this House.

The Under-Secretary of State for the Home Department (Mr. David Mellor): It is a real privilege to be responding to a debate initiated by the right hon. Member for Down, South (Mr. Powell), who is one of the foremost parliamentarians of our age. I say that in all humility. To hear him in full cry makes one realise what a tremendous parliamentary orator he is.
I shall try to deal with the points that the right hon. Gentleman has raised, because, as I said on Tuesday, undoubtedly they are points that touch and concern a number of communities within the United Kingdom. It is perfectly proper that this matter should have been raised, not once but twice. It is a sign of the importance that attaches to this subject that the House is better attended this evening—as happened on Tuesday—than is customary for Adjournment debates. The right hon. Gentleman has his Northern Ireland colleagues with him, and to show the importance that the Government attach to this issue I have with me my hon. Friend the Minister of State who has special responsibility for fishery matters, and my hon. Friend the Under-Secretary of State for Northern Ireland. I shall build on what I said on Tuesday in the hope that I shall give the right hon. Gentleman more satisfaction than I achieved on that occasion.
As the right hon. Gentleman knows, the Home Secretary is charged with particular responsibility for matters relating to the Channel Islands and the Isle of Man. The right hon. Gentleman also knows that, in pursuance of those responsibilities, my right hon. and learned Friend visited the Isle of Man last week to meet its Government. During his meeting with the Isle of Man Executive Council there was a useful and valuable discussion on fisheries in the waters around the Isle of Man, a matter which is at the heart of the right hon. Gentleman's concern.
The right hon. Gentleman listened attentively to the Adjournment debate two days ago, and he heard me state what I believe is a most significant development—that the Isle of Man Government have made a significant change in their position, which previously had been to advocate introducing some element of discrimination into the licensing system that is applied in the waters up to 12 miles from the island. The Manx Government acknowledged at the meeting that such a concept was untenable and that they had dropped it. I repeat what I said on Tuesday, that in view of their assurance, this matter of discrimination need no longer concern us. As a consequence, a real fear has rightly been lifted from United Kingdom fishermen.
Another significant issue remains to be dealt with, and that is, as I said on Tuesday, the discussion of the conservation of fish stock in the waters around the island—a matter of real importance to all who fish there. I believe that it is right for this subject to be examined, and it should be discussed on the merits of a proper scientific examination, which so far has not taken place.
The main burden of the right hon. Gentleman's formidable address tonight was the constitutional position of the Isle of Man. I enter the realms of the constitution with some trepidation when I find myself opposed to the right hon. Gentleman. However, it may be helpful for me to say something of my understanding of the relationship between the Isle of Man and the United Kingdom and between the Tynwald and the United Kingdom Parliament, and to say how that relationship has developed.
For over 1,000 years, Manx law as been made by the island's Parliament, the Tynwald, which is probably the oldest continuing legislature in the world. The legitimacy and validity of Acts of the Tynwald are not based on any grant of competence from the United Kingdom Parliament. Parliament has always recognised their existence and validity, and that recognition can be found in a number of our own statutes, which refer explicitly to Isle of Man legislation. So there is no doubt about the competence of the Tynwald to make law domestic to the Isle of Man. However, one important aspect of the relationship between the United Kingdom and the Isle of Man is the consideration of defence and foreign affairs. The United Kingdom Government are responsible for those matters and the ultimate responsibility for the good government of the Isle of Man. That rests on the right of Parliament to legislate for the island in the last resort. However, I need hardly say that we are not talking about any breakdown of good government or a situation of last resort. The essence of the relationship has been, and continues to be, that the Tynwald legislates in matters domestic to the island, subject to its statutes receiving Royal Assent, that appropriate United Kingdom legislation may be extended to the Isle of Man by Order in Council and that in some contexts United Kingdom legislation may apply to the island diirectly when it deals with matters for which the United Kingdom is responsible on the island's behalf.
In all these contexts, however, there has traditionally been the closest consultations between Her Majesty's Government and the Government of the Isle of Man. A relationship of warmth has existed which I know the house would wish to continue. Indeed, we have no reason to think that this relationship wil not continue even though, of course, ripples pass across the face of the water, literally in this case, as there are bound to be even in the longest running relationships.
It is within this framework that the arrangements for commercial fishing round the Isle of Man have to be seen.
As the right hon. Gentleman made clear, fishing within three miles of the island's coast is administered locally under arrangements which have developed since the passing of the Sea Fisheries Act 1894 of Tynwald. Today under the 1971 and 1983 Acts of the same name and derivation the Isle of Man board of agriculture and fisheries makes byelaws for the regulation of fishing in that three-mile area.
The point at the heart of this is the question of fishing in the waters between three and 12 miles of the island which is administered under United Kingdom legislation. As the right hon. Gentleman has properly pointed out, the principal Act of this House is the Sea Fish (Conservation) Act 1967, as amended, and reproduced in the Act of 1976. This Act gives my hon. Friend, as the United Kingdom Fisheries Minister, the power to establish rules for the control of fishing by means of statutory instruments and to establish a licensing system in respect of fishing vessels.
I come now to the point that I know represents something of a problem between successive Governments and the right hon. Gentleman. Under that Act provision has been made since 1977 for the Isle of Man Board of Agriculture and Fisheries to issue the requisite licences which allow British fishing boats to work the waters in the three to 12-mile zone round the island.
The island board's function in this regard is carried out in close consultation and in full agreement with my right hon. Friends the Ministers responsible within Her Majesty's Government for fisheries. This regime was established to promote the most efficient management of the fisheries in the waters round the Isle of Man. There is a good practical reason for that which the House should consider. The principal fishery involved is that for herring, although there are also important white fisheries. I know of the right hon. Gentleman's constituents' interest in prawns and I believe that they share the interest of the hon. Member for Kingston upon Hull, West (Mr. Randall), who raised the matter on Tuesday, in the shellfish known as queenies.
We believe that members of the Isle of Man board are in by far the best position to advise on and implement agreed changes in weekly catch quotas because they are on the spot. It is, therefore, sensible that the island board should exercise the function of issuing the licences for what is in the context of the herring fishing particularly a short, local rapidly changing fishery. In the context of good and harmonious relationships which have subsisted between the Government of the Isle of Man and my hon. Friend the Fisheries Minister and his predecessors in title, I have no reason to believe that that remains other than a very good idea.
The Isle of Man Government have drawn back from the proposal to introduce discriminatory licensing procedures. But they still wish Her Majesty's Government to consider the possibility of an extension of the area over which their own legislation applies from a three-mile limit to one of 12 miles. The right hon. Gentleman has asked—it is a very fair question—what they hope to gain from such an extension. As I said to the right hon. Gentleman on Tuesday, it may not be for me to speculate on those matters as they are matters for the Isle of Man Government. I can only reiterate our determination that the arrangements should not involve and detriment to fishermen from the United Kingdom who have traditionally and properly plied their trade in the waters around the island.
It appeared from my right hon. and learned Friend's experience on his visit last week that the principal anxiety is to ensure stronger control over conservation. Nondiscriminatory conservation is not a principle that any of us would want to argue against in terms of the Isle of Man or the other extensive fisheries around the United Kingdom.
I have no wish that the right hon. Gentleman's constituents should be under any misapprehension. If any extension—I stress "if" because there is no question of the extension having been agreed to— of jurisdiction were to be contemplated, it would be crucial to ensure that it was compatible with the principles which underlie the existing rules on fishing in the zone in question, which safeguard the interests of the right hon. Gentleman's constituents. It would also have to be compatible with Her Majesty's Government's obligations under the European common fisheries policy and the London convention on fisheries of 1964. There can be no question of the importance that we attach to that. I hope that the right hon. Gentleman will make these points clear to his constituents, who are concerned about the matter, as they are bound to be. I am aware of that concern and I recognise that the


fishing industry is a troubled and difficult one to be in. It should not have its problems added to gratuitously by any misunderstanding on this issue.
The issue which would need to be examined would be whether there was practical advantage to be gained from changing the existing arrangements, given the nature of the fisheries in question and Her Majesty's Government's several responsibilities, especially to the Isle of Man and to the interests of United Kingdom fishermen. There may be a case for a local hand on the tiller, given the particular characteristics of the fisheries and the fishing around the Isle of Man. But these are factors which will have to be considered when the conservation issues are clearer then our current state of knowledge permits us to be this evening.
I hope that my explanation has gone some way towards allaying the concern of the right hon. Gentleman. I can assure him and the House that it is no part of Her Majesty's Government's policies to act unconstitutionally or to fail

to have proper and appropriate regard to their responsibilities to the people of the United Kingdom; but neither can we disregard their duties and historic responsibilities to the Government and people of the Isle of Man.
The right hon. Gentleman knows that the Home Secretary's door is always open to him and that he will never get anything other than a warm welcome in the Home Office when he is pursuing vigorously and properly the interests of his constituents. It was in no sense of regret that I came to the Dispatch Box this evening, and I hope that in doing so I have improved understanding of the issue and done something to reassure the right hon. Gentleman rather than add to the fears that he and his constituents might feel on this important matter.

Question put and agreed to.

Adjourned accordingly at two minutes to Twelve o'clock.